India Inc trains sights on smaller towns

CHENNAI: HR Managers in manufacturing and services sectors face new challenges even as companies increasingly scan rural India and Tier III towns for talent and recruit some of them from agricultural background. These issues range from communication, cultural fit, compensation and even employee retention.

The lessons managers learn from this transition could turn out to be crucial for the country, even as it tries to shift people from highly under-productive agricultural sector to manufacturing and services, observers say.

Agriculture accounts for just about 20% of our GDP, yet employs over 60% of the population — predominantly in rural areas. “We have no other option, but to move them to manufacturing and services,” TC Venkat Subramanian, CMD, Exim Bank said.

The good news is that it is already happening. More importantly, they are finding place in well established companies — even in IT firms — with strong global brand names. E Balaji, COO, HR consultants, Ma Foi said large and mid-sized companies in FMCG, consumer electronics and retail finance sectors saw 26% increase in the intake of employees from smaller places or Tier III towns like Namakkal, Myladuthurai and Nagercoil compared to last year.

Consider some more examples. Of the 250 people in ITC’s Tiruvottiyur factory, 40 have rural background, corporate management committee member R Srinivasan said.

Hyundai Motor India senior VP (HR) GS Ramesh said 60% of the 1,700 people in the workman category have a rural background and majority of them are from down south. Around 74% of people employed in Amara Raja Group manufacturing plants in Chitoor district have rural backgrounds.

IT companies are looking deeper too. Wipro’s senior VP, corporate HRD, Ranjan Acharya said the company was increasingly looking at rural areas for talent. Last year, MindTree Consulting had one-third of its new recruits from agricultural background.

Last year again, iGate Global Solutions hired over 100 IT professionals from Dindigul for its software development facility in Chennai.