A fresher, integrated approach to workplace learning can have a positive role in India's ability to turn its unique demographics into a dividend writes Angie Taras
India's famous ''demographic dividend'' of a young population could turn into a liability unless accompanied by a massive shift in corporate education across all sectors.
A fresher, integrated approach to workplace learning can have a positive role in India's ability to turn its unique demographics into a dividend. Customised workplace training is the most relevant, most adaptable approach for the vast numbers of people forecast to enter the workforce and the most suitable for the current downturn as organisations seek to make every dollar count and reposition for new markets and opportunities.
Fortunately, India has a cultural advantage in its belief in self improvement and high regard for education, providing some optimism that the demographic dividend remains an opportunity and not a headache.
But logistical challenges have the power to test this culture and optimism: 40 per cent of approximately 1.1 billion people under 21 years of age means an unprecedented number of Indians moving into the workforce and commencing careers: the government's 2007-08 economic survey found 68.4 per cent of the population will be of working age (15-64) in 2026, up from 62.9 per cent in 2006.
A Confederation of Indian Industries (CII) study in 2006 found that 80 million new jobs would be created in the next 10 years and that 75 per cent of these will require vocational skills at least.
India's younger generations are described by many business leaders as not ''job ready'' when they graduate university. Graduates are well schooled in traditional, formal learning to build their knowledge base but to be job ready requires more informal learning, and this is where corporate education and training can make a huge difference.
Informal learning includes the soft skills that make people employable such as: leadership, initiative, hands-on knowledge, communications and knowledge of workplace structures. These skills may be vital to the workforce but incorporating them into a formal curriculum has proven difficult across the globe.
Corporate education and training is best placed to fill the breach as it allows organisations to customise informal learning to suit specific workplace challenges. It will also influence how some organisations cope with the downturn, with many human resources departments looking to up-skill their teams in readiness for the eventual upturn.
But it is an investment with its own pitfalls including the pressures of reaching people in large and fragmented organisations, and the mythology of ''one size fits all'' programs which fail to address specific needs.
With India already facing skills shortages in technology, outsourcing, retail, civil aviation, construction and finance, according to McKinsey and Company, and with industry not having the time to wait for the nation's universities and its government to update the system, India's approach to corporate education will be critical.
Industry has been quick off the mark because it has to increase workforce participation and performance from a diminishing supply of skilled human capital. Escalating demand for this skilled human capital has heightened the competition leaving organisations to take matters into their own hands.
Industry specific programmes are being offered by leading players in the finance and banking sector, expected to create over one million new jobs in the next five years. ICICI has joined with a university to create an Academy of Banking and Insurance offering a one-year residential graduate diploma programme. The aim, ''first day, first hour productivity'' from new employees is ambitious and reflects how banking has changed: the imperative is to go out and sell, rather than wait for customers to come in, leading to new specialist roles within banks. Courses in treasury, international banking and microfinance are booming.
Retail is pushing demand higher for training, even though organised retail still only accounts for around 3 per cent of India's retail sector (the rest being small owner driven stores), but that will increase to 20 per cent by as soon as 2010. That will mean 2.2 million new retail jobs. The Retailers Association of India has been active in linking in with training schools and universities.
This shift from owner-driven stores to the larger retail chains where different skill sets are needed is like a jump from 'guru' training (leaders slowly training staff who eventually take over) to a more modern form, and indicative of the need for better integrated and customised education.
Traditional one size fits all approaches, which use a top-down approach to learning, cannot always respond to specific challenges and priorities, including those associated with the economic downturn, and struggle where there is great variance in ability and education among personnel / different teams. For the rapidly growing and often geographically dispersed organisation in modern India, solutions need to be customised, and that requires careful planning, consulting and listening.
Education must become a part of your team whether the end business goal is ongoing induction training or successful management of a major business event such as a merger or acquisition, which has the power to ''make or break'' the parties involved. Merger and acquisitions are likely to increase in reaction to the downturn and success often rides on getting the cultural aspects right. No ''off the shelf'' solution for this exists - only a customised programme can properly address human capital integration issues and respond to strategic and operational objectives.
The importance of getting the education right is shown by the biggest education investment in a single location in India's history (including government and private): the Infosys Technologies corporate training establishment, which has more than 320 faculty staff and a 335 acre campus in Mysore that can train 13,500 people at once.
Infosys's investment in its education is reported to have been over US$450 million. Additional to this, Infosys is known to spend about US$5,000 training each new recruit during a 14- to 16-week programme. This year, it will take on 18,000 fresh graduates.
Many corporations of various sizes and from different industries are making significant educational investments across India; their dollars may not come close to Infosys or ICICI, but proportionately the educational investment is large and must be carefully considered to will influence success.
It is not necessarily something they do purely by choice or to get their culture inculcated in new recruits; it reflects the reality that even graduates from the best universities and colleges in India are not seen by management as ''job ready''. This gap between educational qualification and employability is not exclusive to India though much of India's growth is happening in new sectors which require new skills.
India is seeing the fast emergence of completely new professions and services, such as financial planning and organised retail, where burgeoning growth is taking place and the need for professional certification is immense. Fresh recruits need to gain these new skills, while those already employed also need to be re-skilled at great effort and expense. And then there are the regional challenges.
Much of India's growth is taking place in smaller towns and cities, not just in the big four of Mumbai, Delhi, Kolkata and Chennai, so the training has to be available locally and relevant to a local market. Large organisations risk strategic drift and cultural fragmentation, particularly if the workforce is geographically dispersed; therefore a coordinated and flexible approach, which complements rather than competes with the greater organisation. Organisations that can tailor their educational programmes to reach out to the regions are the best placed to enjoy greater efficiencies and performance benefits, and likely to emerge from the downturn in a position of strength.
Bharti Group is one that has created its own training company called Bharti Resources, which is setting up local training facilities (100 by the end of this year, and forecast to be 1,000 within three years), to train in retail, insurance and telecom.
Tamil Nadu has been a pioneer in the building of ''soft skills'' into university courses, now mandatory for most undergraduate and post graduate courses. There is a huge confluence of efforts of private companies, industry bodies, governments and academia on the one common issue of skills development. It is all being done with sense of urgency, because India seems well aware that the demographic dividend could become a real liability if the skills are not there.
The regional challenge faced by Indian organisations is another reminder that corporate education works best when it is carefully integrated to an organisation's specific business model, culture and goals.
Another challenge is compliance with evolving financial and regulatory principles, practices and standards, which need ongoing training; otherwise it quickly becomes out of date. We have seen life-long learning play a larger role in the career paths of individuals worldwide, and organisations which embrace these ongoing education initiatives reap the benefits of a more engaged, higher performing workforce.
India is currently standing at the crossroads of a huge opportunity, and how it approaches education will have a big say in whether it takes the right path and competes even more strongly in the world. Tapping the ''demographic dividend'' means the country has to put more into skills development. Organisations are spending big dollars on education and training but dollars are not enough; the best way for education to be a true investment and to benefit the organisation during difficult times is to demand strong integration with the business.
Angie Taras is a director of DeakinPrime, the corporate education arm of Australia's Deakin University. DeakinPrime has offices in New Delhi and Melbourne, Australia. www.deakinprime.com Email firstname.lastname@example.org