The R&D and engineering centres of multi-national companies (MNCs) in India are witnessing robust expansion, feverish hiring and impressive salary increments say a recent study. Zinnov, a consulting firm, released its annual study of HR Trends which concluded that the biggest increases in hiring and the highest salary increments are taking place in the R&D centres.The report says that nearly one thousand MNCs operate over 1,200 R&D and engineering centres in India. About a million employees are estimated to be a part of such centres.These verticals, referred to as Global In-house Centres (GICs), perform designated functions for large organizations and have gained much prominence in India during the last two decades. The Zinnovreport studied and surveyed 43 such GICs across India. Here are some of the highlights:
Healthy Hiring in Indian GICs
Hiring in this space grew by 29.2% in 2017 – the highest in the past few years, and nearly two percentage points more than in 2016. This momentum is expected to sustain in 2018 as well, and a healthy growth of 28.5% is expected in hiring this year.This is notably higher than the growth witnessed in the traditional Indian IT sector (of about 8%).Gross hiring activity in top IT companies has also been between 5-10%, whereas net hiring has been mostly negligible recently, the report adds. The study notes that hiring for CIGs is growing at an exceptionally healthy pace, whereas roles in traditional IT and BPM are slowing down (it decreased from 28.6% in 2016 to 26.4% in 2017). Anand Subramaniam, Engagement Manager & Delivery Head Zinnov, explains the latter, “Increased automation, higher process standardization, more focus on resource sharing, as well as increased outsourcing of non-value add work have contributed to the declining growth.”
Niche skills result in high increments
In terms of salary increments, GICs outperformed traditional IT firms by a wide margin. Although marginally lower than in 2016, the average salary increase was recorded to be 11.2% last year; more than double of 5% - the average increase in Infosys and Wipro. Increments for junior employees were the highest, at 14.1%, followed by 12.6% for mid-level employees, 10.5% for senior executives and about 9.1% for top leadership.Employees who received a promotion (16.8%), Top performers (15.1%) and those with niche skills (14-18%) saw the maximum salary increments during the last year. Particularly, employees with niche skills in gaming received the highest increments. The report noted a rise in demand for several niche skills: robotics, UI/UX, mobile, machine learning, analytics, and big data, all of them saw healthy pay increments.
The Rise of Indian GICs
The survey states that rapid advancements in technology, especially in the field of cloud computing, machine learning, artificial intelligence, internet-of-things, and robotics, has forced global giants to tap into the Indian engineering talent in order to enhance their engineering and research operations and drive innovation. This focus on building new solutions has resulted in the R&D arms of organizations growing rapidly, especially in the last few years. Furthermore, the rise of start-ups and enterprises in India also led to an increased thrust in research and innovation.
Initially, GICs in India were established with the purpose utilizing inexpensive resources and deploying the readily-available skilled workforce; however, their success has enabled them to turn into centres of excellence and transform into drivers of innovation, value creation, and efficiency. GICs have gained strategic importance for MNCs in the last decade and are playing an important role in overcome challenges and building innovative solutions. With the results of the report in context, their value has been reiterated.