Abstract
Since liberalizing its economy in 1991, India has experienced rapid expansion, placing it within the top 10 per cent of the world’s countries in terms of economic growth (World Bank, 2015). A key segment of the Indian economy driving expansion, growth and employment has been the information technology (IT) sector, which now accounts for over 8 per cent of the economic output. With over 15,000 firms employing around three million people and generating revenues in excess of US$118 billion, the Indian IT industry has built an enviable reputation for service quality and information security. Underpinning this strong performance has been a considerable investment in human capital and this timely volume, edited by Ashish Malik and Chris Rowley, examines the people management models operating within this vibrant and dynamic sector.
The book opens with a foreword on human resources (HR) value creation by Dave Ulrich and the proceeding 13 chapters in the edited volume are organized into two sections. Part 1 is titled “Human Capital Issues in the Indian IT Industry” and brings together a range of theoretical and empirical contributions charting the growth and development of the industry and the evolution of HR models to meet the emerging skills and technological needs of businesses operating in the sector. Part 2 is labelled “Reflective Practice: Practitioner Insights” and draws upon the experiences of six high-profile Indian HR practitioners, who provide personalized accounts and insights into how the sector has evolved and developed over time.
In a thought-provoking foreword, Dave Ulrich considers the value that HR practitioners, through leveraging human capital effectively, can bring to individuals, organizations and nation-states. He argues that HR value creation exists when the gap between theory and practice is bridged and knowledge, ideas and insight are shared and acted upon. In advocating that, HR practitioners take an outside-in perspective, he states:
Most HR practitioners have an internal mindset. When we ask them “who are your customers?”, they often answer “the employees.” When we ask them “what is your greatest work challenge?”, the answers are often about finding or keeping talent, building talent or managing compensation. To deliver real value, HR must start with the outside-in. This means focusing on the context of business, including social, technological, economic, political, environmental and demographic trends. (p. xvii)
He argues that HR needs to offer integrated solutions to talent, leadership and capability challenges through building innovative capacity and uncovering new and useful perspectives on how to structure systems, networks and practices more effectively.
Chapter 1 by Malik and Rowley provides a useful contextual overview of the IT industry and an explanation of the structure of the edited volume. They distinguish four stages to the development of the Indian IT industry. In the initial early stages of its development, emphasis in the industry was placed on staff augmentation (or “body shopping” as it became known) where a key focus was on recruitment. The growth stage saw a shift to delivering global IT services from India through developing a pool of trainable staff, who could be employed at a lower cost in India than elsewhere. The maturity stage or global services delivery stage saw the development of specialised domain skills to fulfil the “anytime anywhere” business approach where Indian IT specialists were centrally involved in global service IT delivery. Finally, Malik and Rowley describe the current stage as “crowd and cloud,” characterized by delivering IT services through disruptive social, media, mobile, analytical and cloud (SMAC) technologies.
Chapter 2 by Malik and Nilakant outlines the evolution of the IT sector within the context of broader economic development and policy initiatives taken by the Indian government. They classify the IT sector into three subsectors: IT hardware and manufacturing, IT software services and IT-enabled services that include business process outsourcing services. The chapter then gives an overview of the types and volume of activity within each of the subsectors. The authors go on to discuss the growth of dynamic capabilities in the Indian IT sector across five specific time-frames from 1984 to the present day. They conclude that there exists considerable variation amongst Indian IT firms in terms of business models, services provided, product markets and service delivery mechanisms—all contributing to the vibrancy of the sector as a whole.
The third chapter by Malik and Blumenfeld analyzes the issue of skills and competency development within the Indian IT sector. It examines the relevance of both human capital theory and neo-human capital approaches to firms operating in the sector. It explores the applicability of theory related to high performance work systems (HPWS), quality management and organizational learning in explaining the value of training investments in ensuring organizational competitiveness.
Business Process Offshoring (BPO) firms are a central focus of chapter 4. In this chapter, Pereira and Budhwar explain how India has become a major centre for BPO and IT-enabled services, attracting relatively low-skilled transaction work and higher-level professional work. They argue that India remains a foremost destination for offshoring work amongst Western client firms and maintain that the subsector has been steadily proceeding up the value-chain in offering increasingly advanced and innovative services. Using a theoretical framework underpinned by the resource-based view (RBV) of the firm and HPWS, they assert that the ever-changing nature of the subsector requires firms to develop dynamic capabilities and engage in continuous learning to achieve superior firm performance. Acknowledging that there are practically no studies on RBV or HPWS in this sector, they issue a call for greater research efforts to understand the drivers of high performance in BPO settings.
In chapter 5, Sheth and Sharma chart the development of the Indian IT sector from 1981 to the present day. Disappointingly, there are some overlaps in the material presented here and the content presented in chapters 1 and 2. However, the chapter does clearly position the trajectory of the sector and the growth of professional global management culture with Indian IT firms.
Chapters 6 and 7 are both written by Ashish Malik and adopt a case-based approach. Chapter 6 focuses on innovative HR practices in three IT software services firms, while chapter 7 examines innovative HR practices in three software research and development (R&D) firms. A good level of insight is provided into the operations of firms in both software services and software R&D sectors. Both chapters broadly conclude that a wide range of internal and external influences affect HR practices and determine how HR practitioners engage with learning and development approaches. Moreover, both chapters found evidence to suggest that the type of HR practices engaged in by individual firms often reflect the stage of development of the firm itself and any service agreements signed with the client.
Part 2 of the edited volume commences with a chapter on managing people in an IT product R&D environment. Within the chapter, Amit Verma reflects upon his 20 years’ experience of working in the Indian IT sector. In a largely informative ethnographic account, he examines the importance of managing talent, developing an effective learning strategy and cultivating a positive organizational culture. He concludes that a services mindset has now become heavily engrained within the Indian market and that Indian IT firms are now facing an important challenge of developing organizational agility in engaging simultaneously with product development and service delivery.
In chapter 10, George adopts an organizational development (OD) and changed perspective in examining process improvements and quality management within the Indian IT sector. Through a series of seven vignettes, he reflects upon the effectiveness of various change interventions in the sector. He emphasizes the important role of leadership (both individual and collective) and the need for leadership to be unleashed from restrictive organizational structures and practices. He identifies the generative, social-constructive and appreciative enquiry philosophies underpinning OD approaches and the need for OD to play a stronger role in developing more effective and innovative organizational systems.
Mentoring and coaching of senior management are the key themes examined by Kathikeyan in chapter 11. Through mentoring and coaching, senior managers are encouraged to engage in exploration and exploitation behaviours and to cope with disruptive and discontinuous change. The concept of jugaad or frugal innovation is introduced to readers as evidence of a shift in the type and level of innovation now being pursued by many Indian IT firms. As an example, Kathikeyan evidences GE’s (General Electric) development of an electro-cardiogram for the Indian market at a fraction of the cost of other similar devices. The Indian model (MACi) is a reliable and robust product, designed to cope with extremes of dust and heat, with reduced product functionality to suit low-skilled users. The chapter concludes that both exploration and exploitation learning are necessary for maintaining and managing growth and innovation.
Ideapreneurship is the focus of chapter 12 and Shergill and Notra give us a valuable and fascinating insight into the practices engaged in by management and staff at Hindustan Computer Limited (HCL) technologies. The chapter describes the evolution of the firm and the range of initiatives undertaken to unleash employee creativity and potential. Three key employee behaviours are emphasized at HCL, namely:
Need to seed: the search for alternatives from the norm and to pursue incremental continuous improvement.
Desire to nurture: the mentoring of talent and the development and nurturing of ideas to fruition.
Commitment to harvest: an emphasis on results and performance through the achievement of business outcomes and growth.
The chapter outlines the progressive culture pursued by HCL, which recognizes the importance of work–life balance, with the company offering services to employees classified under four categories: work, self, family and life. Community engagement is also discussed as an important aspect of HCL’s activities. The chapter concludes that through engaging in this wide range of activities, employees remain committed and motivated to delivering sustained creativity and innovation in the workplace.
The final chapter by Malik and Rowley advances an integrated model of human capital development and synthesises the theoretical and practice-based perspectives discussed within the edited work. They identify four important HR practices that are the key to supporting a firm’s strategic objectives and business model. First, they argue that firms must clearly understand the customer value proposition. By this, the authors assert that firms must develop a strong market orientation and work hard to meet customer needs. Second, they emphasize the importance of a supporting resources architecture, by identifying, developing and rewarding key talent. Third, they highlight the primacy of generating profit through leveraging economies of scale and realising value through learning and development processes. Finally, they identify the need for robust management processes, ensuring that there are clear lines of communication and that project and programme management approaches are tightly controlled.
Overall, this edited volume provides a valuable insight into human resource management (HRM) practices within the Indian IT sector. Through situated firmly within an Indian context, the volume is likely to appeal to both academics and practitioners in the South Asia region and further afield, wishing to gain insights and understanding from leading firms operating across the IT sector. At times, the volume comes across as repetitive as the introduction to most of the chapters opens with facts and figures pertaining to growth within the Indian IT sector. That being said, the volume is finely balanced with a good mixture of both theoretical and practical insights drawn across the spectrum of firms operating within the industry. As such, the volume represents a solid and valuable contribution to the field and a significant piece of work.