As Hiring Soars In India, Good Managers Are Hard To Find

Accenture plans to increase its India staff this year by 8,000 people to 35,000, surpassing its U.S. employee base. IBM's India staff has jumped from 43,000 to 53,000 in six months, and it expects to maintain a similar growth clip. Both Infosys and Tata Consultancy Services are hiring about 2,000 people a month.

At that pace, that's more than 35,000 new hires for these four companies alone the next six months, and dozens of other tech companies are rushing to add staff in India. So where will all this talent come from?

That's a question businesses should be asking their suppliers of India-based IT and business process services. The country still offers the best talent-to-price ratio of any place in the world, but suppliers admit it's getting increasingly difficult to find and keep the right people—especially at the management level.

"We're not a body shop," says Amitabh Ray, IBM's VP of consulting and application services in its India-based Global Business Services unit. "We need the right kind of people." That means staffers skilled in a variety of enterprise applications, including SAP, PeopleSoft, and Siebel; database administrators; high-end IT architects and database administrators; and project managers and other leaders. Based on current growth rate, IBM will employ 100,000 people in India by 2010, projects AMR Research. It employs about 300,000 worldwide, with about 130,000 in the United States.

IT employers' biggest problem in India, though, is leadership. "We're not finding a lot of seasoned managers," says Mary Jo Morris, president of Global Transformation Services at Computer Sciences Corp., which employs 7,200 in India. CSC tackled that problem by bringing in expatriates or training existing employees.IBM puts good project managers on the fast track. How fast? A good candidate, says Ray, can move from senior program manager to exec in three to four years. With that kind of opportunity, look for more U.S. IT managers to jump on that fast track. Cisco chief globalization officer Wim Elfrink, who reports to CEO John Chambers, moved to India from Silicon Valley a few weeks ago. He expects Cisco to have about 20% of its top talent—Indians and Silicon Valley expats—in Bangalore by 2010. In October, Google swiped Yahoo India's CTO, Prasad Bharat Ram, to head its research and development lab in Bangalore; Google has said it's having trouble finding middle managers in India, plus programmers skilled in JavaScript and Ajax.

India produces 400,000 technically trained graduates a year, but many are deficient in areas of specific technical skills, teamwork, and language, according to a study last year by McKinsey and the India IT industry's National Association Of Software And Services Companies, which is working to improve training and educational programs. Industry helps. IBM trained 80,000 college students the past year on open standards technologies, worked with faculty to steer software skills toward current business needs, and launched a two-year program to help middle and high school teachers develop new curriculum and teaching methodologies. Wipro's planning a program to train engineering faculty in modern teaching techniques and skill requirements.

But retention's the day-to-day challenge for these companies. IBM tries to give employees options to move around in programming, research and development, and business process outsourcing. "Normally people leave a company to do something different," Ray says. At CSC, the techniques range from offering career development and recognition programs to sending cakes to employees on their birthdays.

But as the talent crunch tightens, particularly for managers, IT services and technology firms in India could find themselves squeezing more from their best employees. At some point, even a birthday cake won't cut it to keep them happy.