CIOL:HRO growth will still take some time

When you see the bigger picture, do you think HR per se in India has covered the 'From backroom to boardroom' lap?

When I left India in 1986, HR was synonymous to IR (Industrial Relations). Only recently, it has started transforming for the better in the IT industry. Now clearly, senior HR executives are part of the CEO's management team because ultimately, it is these people who are taking the charge of the right leadership and the right organisation. In fact, it is hard to find seasoned HR executives in that light. We need to make HR a little more metric-oriented too. Anything worth managing is worth measuring, after all.
Ranjan Sinha, chairman and CEO of Summit HR Worldwide

Ranjan Sinha, chairman and CEO of Summit HR Worldwide

So is HRO getting closer to BPO (Business Process Outsourcing) from BOP (Back Office Processing)?

I think it will. For instance, recruitment is an important function for any organization but not a core competence.

Does that make your job easier or harder? Has India arrived on the HRO map for the world?

Well, visionary CEOs are already looking at HRO in the right perspective. A company that is good at making shirts, for example, has its core competency there and thus can outsource non-core activities to an offshore partner. Outsourcing too is two-pronged. It can be either managed services or complete outsourcing. Geographically, US and Europe are hot business areas in terms of HR Outsourcing. Off shoring, however, is not growing at the same pace for HR as in the case of financial services.

Why has HRO lagged vis-à-vis FPO (Financial Process Outsourcing)?

At the heart of it, HRO is trickier than FPO. Lack of cross-industry standardisation, degree of people interactiveness, domain complexity are some reasons. For instance, metrics in RPO (Recruitment Process Outsourcing) are nor about call-times but about the right candidate, the complete solution. HR is more complex and regulated. Processes here are not as standardised as in Finance. Migration will eventually happen, but the pace will be slower.

How many processes in the HR gamut are amenable to outsourcing?

Theoretically, all processes can be outsourced. It gets easier on a scale level, for example - payroll, benefit administration, taxes etc figure foremost on this ladder.

Has your organisation covered the transactional to strategic spectrum in HRO business so far?

In India, it is still at a transactional level. Otherwise, we are closer to the high-end side and more of strategic partners to our clients with talent SCM (Supply Chain Management) as one of our offerings. Next year, we plan to open a new centre in India too that will cater to availability matrix.

How significant can the PSU and government sector in India be in terms of your HRO revenues? Do you see the indigenous slice here as a potential market?

Globally, some of our largest contracts have come from government agencies. They have been receptive and interested for HRO and some of the pioneering work in US specially has come from the government sector. But In India, so far I think it is the MNCs who are adding bigger scales, would lead the HRO growth. At the moment, we have no business in India from the government side. As far as the domestic market is concerned, I presume it to be a mix of both. In fact, any company in the mid-size area that is a global brand, irrespective of whether it's origin is in India or abroad, would be a ripe market. Sectors like engineering, finance, insurance, retail, manufacturing and of course IT would be hot for HRO.

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