As businesses in China and India seek more workers, they're encountering a shortage of new hires with soft skills
Juniper Networks, a maker of high-end routers, needs 600 technical staff in Bangalore this year. Worksoft Creative Software Technology, an outsourcing firm in Beijing with clients like IBM, intends to hire 850-plus engineers in 2006 and another thousand next year.
For the two firms, at either end of Asia, the problem is the same: the new hires just aren't there.
"There is a disjoint between what skills the companies need and what universities impart to the tech students," says Ashish Sharma, a technology analyst at consultant Arthur D. Little in Singapore.
A common complaint is that universities in the region neglect soft skills and are too theoretical in their approach, placing general concepts over hands-on training. In top universities in China, for example, "the traditional education system doesn't emphasize practical experience," says Kevin Liu, EVP at Worksoft.
Lu Ellen Schafer, executive director of Global Savvy, a California-based cross-cultural training company whose clients include HP, IBM and Juniper, notes: "What MNCs are finding in India is that some of their "freshers", new college grads, are not as polished as they would like. The presentation skills of some of them leave a lot to be desired."
Clear communication skills, Schafer adds, are especially critical on virtual teams, which many MNC employees now work on. "I spend a lot of my time training young engineers in India, China and other places in how to speak up, take initiative, offer suggestions, present virtually and influence globally."
Edward Mandla, who runs Smartforce Solutions in Australia, which specializes in workforce strategies around acquiring, training and retaining staff, sees the skills shortage as a product of the IT industry being in transition. "IT is moving from the backroom into the boardroom, and there is a strong need for IT workers to have soft skills, like presentation skills, teamwork skills and the ability to put together a business case."
"Twenty years ago our industry was all about programming in a dark windowless room, but we have had a major change and universities have been extremely slow to get off the mark and embrace these soft skills, and in fact a couple of heads of school went public this year and said it might actually be beyond a university to be able to do that," he explained.
"There's a disconnect between what is available and what is in demand - our universities are still pumping out programmers and less than 20% of the industry is now programming."
A study by McKinsey in October 2005 on China's looming talent shortage stated that the country's pool of young engineers considered suitable for work in an MNC is about 160,000 - no larger than the United Kingdom's. This despite the fact that China produced about 600,000 engineering grads last year, compared to 70,000 in the US. The study blamed China's problems on a "bias toward theory" and neglect of practical training in universities.
In Hong Kong, Agnes Mak, SVP for mobile IT at Sunday, observes the difficulties she faces in hiring talent lie around the lack of business acumen. "Most young professionals are technically sound but lack the ability to apply that knowledge to solve real business problems," she says.
Finding the technical skills is seemingly not an issue for Mak, but "finding staff with the combination of technical competence and industry know-how has been a problem," she noted. "It's much harder to find and train business understanding."
In the telecoms industry, Mak has seen massive demand for business intelligence and data-mining skills. Telecoms operators are all striving to improve customer data management and develop predictive models to improve customer strategies, but they face stiff competition from banks who are locked on the same target.
In our case we've lost a lot of people to banks after training and building up a good group of business intelligence staff," she said. "But it's impossible to fight with the banks in this area as they can offer much more financially to these staff."
Meanwhile, technology hasn't recaptured its popularity as a career choice among students (and their parents). "
Before the dot-com bust, everybody wanted to become an IT person," says Sandy Walsh, manager of education programs in Cisco Asia-Pacific. Whereas today "it is a big challenge for the IT industry to make sure that we still attract bright and interested people into the market."
At the same time, technology workers with real-world experience are in strong demand. "Our hiring managers would say they're not satisfied with the supply," says Charles Caldwell, human resources director for Asia Pacific at Juniper Networks. "Obviously there's a talent shortage. It's a red-hot market. People are hiring."
Industry in the classroom
Asian businesses are increasingly turning to universities, which in turn feel pressure from both business and government to make their courses more relevant to the business environment.
"Everywhere across this region," notes Walsh, "academic organizations are being asked to go out and engage with the industry more."
Collaboration between corporations and universities can take several forms. A company might donate industry software, hardware and teaching materials. This summer SAS provided data-mining software and related funding to Singapore's Nanyang Technological University. In May 2005 Juniper Networks donated security solutions and routing platforms worth about $4 million to Tsinghua University in Beijing.
In many cases companies send employees into the classroom. "We have Intel engineers come in to the universities and co-teach it with the professors," says Loo Cheng Cheng, the chipmaker's higher education manager for the Asia Pacific.
Intel wants students to know how to optimize programs for its multicore platform, and hands-on lab work is essential to that. "In the past you had project work that is pretty superficial in terms of the lab experience. We're working with the universities to change that," says Loo.
A company might offer suggested curriculums, which universities can borrow from as they see fit. These suggestions are based partly on what stage a market is at in its development. In Laos for instance Cisco encourages training on core fundamentals, while in Australia it emphasizes emerging technologies like VoIP and wireless networking security.
Cisco started with basic networking curriculums back eight or nine years ago.
"As the market has developed around the world, we've found we needed to add additional curriculum to the program to meet what the industry demanded, and what the graduates needed to have to be successful getting into the workforce," explained Walsh.
Clearly, companies have more in mind than altruism when it comes to assisting a university. An ulterior motive might be to help cement a market lead, for instance, or ensure that enough people are familiar with its brand of technology. "This is not just a good seeding ground, but also an excellent brand-building platform," notes Sharma of Arthur D. Little.
While companies may have a genuine interest in improving the overall talent pool, their main objective no doubt is to help to develop a pool quality graduates to potentially recruit from.
Cisco was one of the pioneers in university-corporation cooperation. In the early days, says Walsh, "there was certainly resistance and suspicion about why we would give away programs for free. But clearly for us if we are successful at building a trained and educated workforce ... then that helps our business, it helps our customers and our partners, and it generally helps the business environment."
Not all universities are immediately receptive to outside help. Liu of Worksoft notes that many of China's top universities are reluctant to tamper with their curriculums. For this reason Worksoft seeks its fresh recruits primarily from lesser-known, more flexible institutions, such as the Beijing Information Technology College.
These schools are more likely to participate in vendor programs like IBM's Academic Initiative, which cover a lot of practical courses, like Java programming, C++ programming and network administration.
The growing popularity of certification programs like the Cisco Certified Network Associate (CCNA), which is focused on hands-on skills, demonstrates the strong need for more practical training courses that give employers confidence graduates have a the basic fundamentals in which they can build upon.
Beyond orientation In addition external training, organizations have also been relying more on in-house development to provide the skills they find missing in new recruits. Of course every organization has its own processes, and there's always an element of one to two months of orientation before a new employee is given any major responsibilities.
This training period is also being used to provide the technical and soft skills that graduates missed in university - to fill in the gaps, essentially. A common approach is to use a prolonged internship or training period during which fresh graduates learn useful skills while the company gets to evaluate them.
For example Juniper Networks filters graduates through an internship program at the company's R&D center in Bangalore. Instead of one or two months, this program can last six months to a year.
Meanwhile, more universities around the region are starting to listen to industry. "It's important that our university training does produce graduates who are not only well trained in their own discipline, but also receive some exposure to the industry software, to the kinds of problems [companies] face," says Lim Ee Peng, a professor at Nanyang Technological University in Singapore.
Of course universities need to exercise some due diligence - "too much from a few companies only impairs, not just its own standing in the long run, but also may harm the career prospects of its students," says Sharma of Arthur D. Little. "So they need to ensure that they do not end up being perceived as 'Java school,'" for example.
Professor Lim is aware of the danger: "We are not saying that every student must use SAS. That's not our goal. Our goal is to make it possible for some students who have this interest to gain more knowledge about this software and also to benefit from it."
He recalls early conversations with representatives from SAS, which started after the company helped sponsor a university data-mining conference: "We came to this common view that we should work together to benefit both the students and the industry."