Talent management addresses the needs of attraction and retention in a talent starved world
Organizations are choosing horses for courses - Dhruv Prakash, MD, India, Leadership & Talent Consulting, Korn/Ferry International
What is your view of the HR consulting and services industry?
The industry can be divided into three sectors: HR Consulting comprising HR advisory firms, Recruiting firms and Leadership development firms. The market size for HR Advisory and Leadership consulting would be Rs. 450 crores approximately. Then there is the HR Technology market and the HR Outsourcing market. MNCs typically tend to be the largest users for compensation data and advisory services while PSUs and Indian firms spend the most in the HR advisory services. PSUs also are spending on HR Technology to a large extent.
What is driving the growth of the HR services industry?
HR budgets are growing since quality of people, attraction and retention are driving the growth and success of businesses more than ever before. Efficiency and cost of managing the people processes is also becoming significant and attracting attention and investment. HR spending has the attention of the CEO and the CFO of an organization.
How are HR functions changing in their approach to buying HR services?
HR functional leaders are getting better at it. They now choose horses for courses, and focus on one theme at a time.
What are the biggest challenges facing HR services firms?
Consulting firms face people challenges, as availability of quality talent has not kept pace with demand and the cost of talent is rising steeply. They face pricing challenges too. Larger strategy consulting firms also often compete with them for certain assignments. Large global strategy firm has for example, may also take up executive search or leadership development type of assignments. The number of small boutique firms and freelance players pose another challenge. Earlier they were largely in the training space, but now the consulting market is also seeing a large number of such firms and individuals.
What according to you are the trends for the future?
The market is reaching a point where consolidation is due. While globally this has been happening, Towers Watson and Aon Hewitt being examples, there are no visible signs yet of consolidation in the domestic market. Given that the growth of business in the new economic order will be driven by talent, the whole space of consulting around Talent Management would grow and other services will end up supporting the Talent Management as a practice. Data services are moving to a commodity, as they address basic levels of managing cost, performance levels and job and role content. Talent Management addresses the needs of attraction and retention in a talent starved world. New verticals like Education sector and NGOs will become larger buyers of HR services as they professionalize and become mature.