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Ananya Sabharwal, a second-year management student, is thrilled with the pre-placement offer (PPO) she received from Hindustan Unilever (HUL) for a position in its human resources department. While interning with HUL in April-May, Sabharwal realised the importance of HR when she was handling projects on best practices to enhance the efficiency of the sales workforce.
For her, HR is the top ranking function in any organisation. "It offers a lot of scope for career growth," she says. But Sabharwal is a rarity. Most management students are enamoured by the profiles and packages offered by investment banks, consulting firms and IT companies, and choose to enter finance, marketing or even operations domains, passing up a career in HR.
The trend is clear in the figures. At Symbiosis Centre for Management and Human Resource Development (SCMHRD), a leading HR institute based in Pune, only 38 students out of 196 in the second-year batch have opted for HR as a specialisation. Likewise, in Jamshedpur's Xavier Labour Relations Institute (XLRI), one of the topmost management schools for HR professionals, there are only 65 seats for HR specialisation.
"We are looking to double seats from academic year 2009. An approval from the statutory authority is awaited," says Madhukar Shukla, a professor of organisational behaviour and strategic management at XLRI. At the Indian Institutes of Management (IIMs), only about 5% students have opted for HR jobs, says Sougata Ray, a professor of strategic management at IIM-Calcutta.
For her, HR is the top ranking function in any organisation. "It offers a lot of scope for career growth," she says. But Sabharwal is a rarity. Most management students are enamoured by the profiles and packages offered by investment banks, consulting firms and IT companies, and choose to enter finance, marketing or even operations domains, passing up a career in HR.
The trend is clear in the figures. At Symbiosis Centre for Management and Human Resource Development (SCMHRD), a leading HR institute based in Pune, only 38 students out of 196 in the second-year batch have opted for HR as a specialisation. Likewise, in Jamshedpur's Xavier Labour Relations Institute (XLRI), one of the topmost management schools for HR professionals, there are only 65 seats for HR specialisation.
"We are looking to double seats from academic year 2009. An approval from the statutory authority is awaited," says Madhukar Shukla, a professor of organisational behaviour and strategic management at XLRI. At the Indian Institutes of Management (IIMs), only about 5% students have opted for HR jobs, says Sougata Ray, a professor of strategic management at IIM-Calcutta.
It's ironic that the industry that is supposed to hunt for manpower is facing a crunch itself. Ravi Shankar, global head (talent management) at IT firm HCL Technologies, says the industry is reeling under a huge demand-supply gap. "Annually, we manage to hire just 60-70 MBAs with HR specialisation out of the 10,000 employees recruited," he says.
Ideally, the HR professional to employee ratio in any organisation should be 1:200, says G Ravindran, managing director of Strategic Human Resource Management India (SHRM). "But in India, in several organisations, it is as high as 1:500."
In tough times as these, economic headwinds force companies to optimise employee costs and so, the HR function assumes significance, says Sanjay Jha, executive director of Mumbai-based talent management firm Walchand TalentFirst. "The HR manager will be measured on various metrics like staff costs, attrition, etc. He should be someone who understands the implications of the profit/loss account well." A ratio of 1:500 cannot help organisations at a time when attrition rates are above15% in several industries.
Add to this the fact that companies, especially in banking, financial services, insurance, and IT, are recruiting 5,000-25,000 employees this year, and the need for HR professionals becomes rather important. According to Jha, if the current circumstances persist, India will see a shortage of at least 40,000 HR professionals in the next two years.
This shortage is driven by the failure of management schools in producing sufficient numbers. Of the 1,600 business schools affiliated to industry body All India Council for Technical Education (AICTE), only about 8-10 offer specialised courses in HR and people management. "The number of management graduates with an HR specialisation is not more than 500 per annum," says XLRI's Shukla. The number is rather small if you consider that over 80,000 management graduates and 5.5 lakh engineering graduates pass out from institutes every year.
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Small pay packages offered in the HR industry also repel management students. "HR jobs pay less than finance or marketing jobs," says IIM-C's Ray. He adds that the salary difference between an HR and a finance job can be as high as 60%, and in some cases, especially investment banks, even 100%. "Students pass up HR jobs and go for the glamour and money attached to finance and marketing jobs," says Ray.
Besides, most management students have an analytical bent and HR is more about people management. "Management schools are mostly filed with engineering graduates who have a technical bent of mind, and are not game for a function that requires a high dose of interpersonal skills," says Ray.
Small pay packages offered in the HR industry also repel management students. "HR jobs pay less than finance or marketing jobs," says IIM-C's Ray. He adds that the salary difference between an HR and a finance job can be as high as 60%, and in some cases, especially investment banks, even 100%. "Students pass up HR jobs and go for the glamour and money attached to finance and marketing jobs," says Ray.
Besides, most management students have an analytical bent and HR is more about people management. "Management schools are mostly filed with engineering graduates who have a technical bent of mind, and are not game for a function that requires a high dose of interpersonal skills," says Ray.
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