Economic Development Strategies and Macro- and Micro-Level Human Resource Policies: the Case of India’s “Outsourcing” Industry

Topics: Business process outsourcing, Outsourcing, Human resources Pages: 58 (19766 words) Published: June 25, 2013
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Economic Development Strategies and Macro- and Micro-level Human Resource Policies: The Case of India’s “Outsourcing” Industry Sarosh Kuruvilla
Cornell University, sck4@cornell.edu

Aruna Ranganathan
Massachusetts Institute of Technology

Follow this and additional works at: http://digitalcommons.ilr.cornell.edu/articles Part of the Human Resources Management Commons This Article is brought to you for free and open access by the ILR Collection at DigitalCommons@ILR. It has been accepted for inclusion in Articles and Chapters by an authorized administrator of DigitalCommons@ILR. For more information, please contact jdd10@cornell.edu.

Economic Development Strategies and Macro- and Micro-level Human Resource Policies: The Case of India’s “Outsourcing” Industry Abstract

This detailed case study of India's "outsourcing" industry illustrates the challenges in linking macro and micro human resource policies with an economic development strategy based on export-oriented services. The rapid expansion in the outsourcing of services to India has raised the possibility that this sector will be a key engine of India's economic growth. Based on extensive field research carried out over a four-year period, the authors of this study argue that four interrelated human resource policy challenges threaten the outsourcing industry's growth: two "macro" problems (current skill shortages and the inability of the country to produce higher levels of skills for the long-term growth and sustainability of the industry), and two micro problems (very high levels of employee turnover and rapidly increasing employee costs). The authors evaluate current policy responses and suggest options. Keywords

India, outsourcing, human resources, economic development
Disciplines

Human Resources Management
Comments

Suggested Citation Kuruvilla, S., & Ranganathan, A. (2008). Economic development strategies and macro- and micro-level human resource policies: The case of India’s “outsourcing” industry. Retrieved [insert date] from Cornell University, ILR School site: http://digitalcommons.ilr.cornell.edu/articles/165/ Required Publisher Statement Final paper published as Kuruvilla, S. & Ranganathan, A. (2008). Economic development strategies and macro- and micro-level human resource policies: The case of India's "outsourcing" industry. Industrial and Labor Relations Review 62(1), 39-72. Published by Cornell University.

This article is available at DigitalCommons@ILR: http://digitalcommons.ilr.cornell.edu/articles/165

ECONOMIC DEVELOPMENT STRATEGIES AND MACRO- AND MICRO-LEVEL HUMAN RESOURCE POLICIES: THE CASE OF INDIA'S "OUTSOURCING" INDUSTRY SAROSH KURUVILLA and ARUNA RANGANATHAN*

*Sarosh Kuruvilla is Professor of Comparative Industrial Relations and Asian Studies at Cornell University, and Aruna Ranganathan is a doctoral candidate at the Sloan School of Management, Massachusetts Institute of Technology. This research is based on fieldwork in India done by the first author in 2004–2005 as a Fulbright research fellow, with follow-up visits in 2005 and 2006, and fieldwork done by the second author in the summer of 2007. The authors thank Clete Daniel for an introduction to Henry Ford's ideas, Mingwei Liu for research assistance, seminar participants at the Indian Institute of Management (Calcutta), the Institute for Work and Employment Research at MIT Sloan School of Management, and the Department of Collective Bargaining at Cornell University for comments and suggestions, and our myriad informants (industry professionals, academics, journalists, and government officials) in the outsourcing industry for their perspectives.

Abstract

This detailed case study of India's "outsourcing" industry illustrates the challenges in linking macro and micro human resource policies with an economic development strategy based on export-oriented...

References: Source: NASSCOM Strategic Review (2007). aNew segment called Engineering Services, R&D, and Software Products created (earlier encompassed by software and BPO segments). bProjections (made before the creation of the new segment).
2.7% 2.9% 3.2% 3.5% 4.1% 4.8% 5.4%
Source: NASSCOM Strategic Review (2007)
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