Interview: TV Mohandas Pai - CFO Infosys Technologies

‘We are faced with a severe human capacity restraint in India’

(FE 01/05/2006) Mumbai - As the chief financial officer of Infosys Technologies during the past 12 years, TV Mohandas Pai has played a vital role in driving many first-of-its-kind initiatives. On April 30, Mr Pai stepped down as CFO of the IT major to head the human resource, education and research and administration functions at Infosys, that employs over 50,000 professionals. Speaking to Reema Jose and Somasroy Chakraborty, Mr Pai discusses Infosys’ vision on attracting and retaining the best talent pool and his concerns on India’s education system. Excerpts:

In your new role, what are your immediate and long- term responsibilities?

To act as mentor to the HR and education research team, to lay down strategy, align it with the corporate goal and to work on a set of policies to execute these. Our HR team has redefined the HR landscape here in the past 10 years.

So many of the things you hear now in the Indian industry, like creating an open, collegial, transparent culture, putting people first, was started by Infosys. ESOPs as a means of retention and attraction and empowerment of the educated middle- class are all now words that are part of the common language. These were introduced by us.

We will recruit 25,000 people this year. For this, we have to look at 1.5 million resumes, recruit the people, train and do the appraisals in time.

What would your focus be as the HR head?

Today, there is greater demand for bright young minds than it was five years ago, because we have competition from financial services, from manufacturing, from retail and even construction companies. And from the rest of the world, which is also coming here. We must retain our edge.

The challenge is that when the scaling up is done, to ensure bonding between the employees and the corporation, expand to create a robust organisational design of the future, what the organisation is going to look like in the next five years.

What concerns you about the crowded market?

The key challenge is to make sure we remain as attractive as possible for bright young minds. Second, to work with policymakers to expand the pool of people available for the industry, for the whole of the Indian industry. And I am very deeply worried. India graduates about 3,70,000 engineers a year, out of which 2,00,000 are reasonably good. The IT industry this year would hire 1,40,000 out of that.. So what is left for the rest of Indian industry? And if we are hiring 1,70,000 people next year, what is left?

So, we have a severe capacity restraint . If India has to grow at 8% a year for the next 10 years, or grow 10% as the PM is telling us to, then this is the biggest challenge. Our airports and roads are getting built, there’s a lot of action on infrastructure. But in human resources, we are just not there. Part of my job will be to interact with policymakers to tell them there is a call for action.

Infosys has a global work force. How will you take this practice forward?

We want to make sure that in the number of people we hire, the share of our global workforce will expand, so in the customer-facing group we have 60% employees who are local nationals. We have centres in China with 500 people, in Australia we’ve got 350 , in Mauritius about 100. We want to make sure all these numbers rise. We are looking at countries in South America, Eastern Europe. We have Japanese nationals, Americans and Europeans working for us in India.

One of the dreams we have is to create conditions where expat employees would want to come and work from Bangalore, Pune, Chennai. We are already doing it, but want to expand. It (recruiting foreigners) is important, it enables you to have a diverse workforce. We have to make sure they reflect our marketplace. Our markets are in the west. If we have our expat employees working here, they will understand the way we work, how things are managed and our culture. Our people, too, will understand how to work in a different culture in India itself.

What is the Infosys management doing in this area?

NR Narayana Murthy (Infosys chief mentor and founder) is meeting the PM on higher education. We have to lead from the front to preserve the academic autonomy of higher education institutions. Nandan Nilekani is a member of the Knowledge Commission and is working with the Planning Commission on initiatives for higher education. We are working with AICTE and will work with the UGC and engage at the policy-making level. We cannot be an oasis of prosperity in a sea of misery. We have to make sure every young Indian has access to higher quality education.

Mr Murthy has been pushing for the IIMs to expand. It’s so sad that 3,00,000 young minds sit for 5,000 seats and 2,95,000 get disappointed. Why should we, as a society, penalise our young because we can’t get our act together?

What is the ratio of freshers to laterals in the company?

Two to one. There are not enough laterals to hire. This year, we will hire about 5,000 of them. The pool of laterals with more than five years of experience may be one lakh people in the entire country.

Does this not call for more investment in training?

The IT-ITeS sector will have to spend $2.6 billion in the next three years in educating and training the workforce. This enormous cost is because of the inability of the education system to come up to our requirements. The gap is in domain expertise and in the education we give. People can’t communicate, can’t articulate. We are working with colleges to make sure they understand what we want, because we have to expand our labour pool.