People management will be the biggest driver of competitive advantage for organizations. Hence, the industry of HR has tremendous potential in the coming times. In addition to the large conglomerates & the corporate sector; from the consumer point of view, the biggest demand for HR services will come from the SME and MSME sectors as they mostly do not have an in house HR infrastructure.
In the Indian industry, most HR professionals have deep functional knowledge, but few have the time or possess the skills for both strategy and execution as they continue to do mostly transactional work. But as business expects HR to act as a strategic partner, organizations will look to employ service partners who can enable them to make a strategic impact on competitive advantage & business outcomes - in domains of specific subject matter expertise, niche services or service products.
The Indian HR service consumer has several large national and international players to choose from. The presence of international players brings in the much needed global expertise and maturity to the market. While there is no dearth of choices, Indian companies face the same issues while working with large and reputed global service companies. Global companies bring their learning and best practices from their experience and try to implement them in India without customization. Indian conditions, however, are characteristically different and consumers of HR services in India are more interested in locally tailored solutions with a deep understanding of the Indian economy, price sensitivities, employee & consumer behaviour & market forces. This presents a big opportunity for local as well as global firms operating in the India market. Indian HR service providers playing in the global market is a distinct possibility too – provided they are able to scale the learning curve quickly and are able to offer products and services of quality with multiple usp s.
With the increasing proliferation of social media in HR, companies will reduce their spending on a few services, especially recruitment processes. Spending on print media advertising, for example, has gone down drastically in the recent times. With the advent of certain social media products such as LinkedIn Connect, the traditional top-end search market is likely to get affected. Social media services have the potential to bring down the cost of companies by a significant margin. However, it needs to be borne in mind that HR services will be more about value propositions than questions of mere cost efficiencies.
In the future, organizations will assess the credibility of a service provider based on its ability to convey clarity of vision and offer a clear value proposition with verifiable business outcomes. Buyers will keep a close eye on technological advances, which will likely influence the whole industry of HR.
As told to People Matters