Times of India
The skills, talents, attitudes, norms and values of a business are key to its success. About 600 million people, more than half of India’s population, are under 25 years old. No country has more young people. This huge bank of human capital can be a formidable competitive advantage globally. As other countries’ populations age, India will provide the vigour of youth for decades to come.
For India to achieve its potential and capture the opportunities of the 21st century, it would need the full participation of the working population. Government and industry have a crucial role to play in harnessing this potential. With 10 million graduates every year, opportunities need to be created at scale. That makes almost millions of them eligible for employment per month, but the rate of job creation in the country is not keeping up. Data from the Centre for Monitoring Indian Economy (CMIE) suggests that the employment rate fell to 41.4% in 2017-18 from 42.6% in 2016-17.
Economic growth creates employment, and the consumption of the employed drives growth in a virtuous cycle. India’s growth is clearly creating employment as factor productivity of labour cannot reasonably grow annually at the rates of growth the country is experiencing.
Until now, manufacturing was fundamental to a country’s economic success. Industrialisation has driven the growth of many developed economies, boosting innovation and creating jobs. But with advanced technologies powering the fourth industrial revolution (I4.0) and changing the face of manufacturing, there is now a need to build a workforce by investing in the right skills, innovations, institutional partnerships and policy frameworks.
To build a workforce predisposed to a relentless pursuit of innovation and change, organisations will need to foster more nimble cultures where employees can continuously learn and develop new skills. Investing more and more efficiently in people will enable companies to tap into the massive talent and prepare their business for future competition.
Given that we are in the midst of i4.0 means more skilling for IT/ITeS. For instance, today, over 50% of the IT/ITeS industry workforce needs upskilling and reskilling.
While a lot of hope is pegged on reaping the benefits of it, we will truly benefit if we train our available talent with the requirements of the new disruptive technologies. To ensure the country’s envisioned income growth, and hence consumption growth, massive efforts will be needed to provide the right skills and gainful employment.
Alongside skilling, companies need to offer a new employee experience — which is designed to attract and retain the best and the brightest — to meet the needs of the multigenerational workforce.
The next-generation human resources (HR) function will be critical to competitive advantage. They have an essential role to play, replacing traditional ‘best practices and cost-cutting’ approaches with bold new strategies, structures, tools, processes and metrics. HR must reshape itself and the organisation’s workforce to drive value and competitive advantage as never before. Those that get it are acting decisively, viewing HR as a new value-driver. They are also turning to data, predictive insights and AI to enhance their understanding of what works and what does not. The goal is to drive an ongoing solution in which HR reshapes itself and the organisation’s workforce to drive value and competitive advantage as never before.
Time is of the essence and today’s HR leaders need to be initiating and sustaining “the right conversations” with business leaders. HR teams need to become “comfortable being uncomfortable” in this disrupted environment. HR should drive a mindset where people are at the centre of the picture. We are in a world where if companies do not develop, empower and reward their employees equitably, trust in the organisation will be eroded. The ever-growing human capital will be a major driver of this growth.
Hence, we need to use it to our competitive advantage. It’s about people at the centre of the picture.
The writer is chairman & CEO, KPMG in India