Glamorizing Kolkata

It's been a dormant city for years together with a government that had
strictly and consciously kept investment away from this once thriving center of
business during the British Raj, as well as the early years post independence.
But the last five years have seen the City of Joy on an active mode on the
business front. With a more pragmatic Chief Minister at the helm and the ruling
government that is more than willing to follow capitalism at the backdrop of
Marxism, West Bengal, especially Kolkata, is at the prime of action today.

IT has been chosen as the medium of attracting investment to the state today
as well as the key driver of growth. The government has left no stone unturned
to provide the right environment to sell Bengal through well-designed
advertising campaigns: 'Advantage Bengal'. Says Ravindra Chamaria, who is
credited with the construction of the first IT Park in the state-called
Infinity-at Kolkata's throbbing IT hub, “We no longer need to sell Kolkata
as an investment destination.”  

"The quality of talent available in Kolkata is great" -Ajoyendra Mukherjee, vice president, TCS

Today, Kolkata is an exciting destination for IT. In the last one year some
of the biggest names such as E&Y, Capgemini, Lloyds TSB Bank, ICICI
OneSource,  IBM, Nokia, HCL
Technologies, Nortel Networks, Lexmark, Bharti (Airtel), Siemens, Wipro, Infosys,
IXIA, Cognizant, TCS, Genpact, HSBC have either set up facilities or are in the
process of doing so. While excitement levels are certainly at an all time high,
can Kolkata be compared to Bangalore or Gurgaon or even Hyderabad as a glamorous
destination to work in?

Advantage Bengal

The IT industry has a very cosmopolitan workforce. Given Kolkata's image
in the industry, how difficult is it to attract the cosmopolitan workforce to
the city? In all likelihood, this is the question that could haunt the common
mind. The industry's take on the same question is quite positive.

One, Kolkata is known to be a hot-seat for talent. Currently, there are 52
government engineering colleges of repute in the state, in addition to a huge
number of private ones. At present, West Bengal produces 600 engineering
graduates (B Tech degree holders). Science graduates in Biotech/Microbiology/Bioinformatics
number 440 per year while the number of MSc degree holders churned out in the
same disciplines comes close to 200. Over 20,000 students enroll in various
disciplines of engineering every year. In addition to this there are reputed
colleges such as Presidency, St Xaviers, Loreto and two reputed
universities-Calcutta University and Jadavpur University. Of the seven
engineering colleges shortlisted by the HRD Ministry towards being given the
status of the IITs, two are from Kolkata-Bengal Engineering College and
Jadavpur University's Engineering & Technology department.

Today, West Bengal's single-largest strength is its talent pool. Says
Ajoyendra Mukherjee, vice president, TCS, “The quality of talent available in
Kolkata is great.”  TCS, for
example, is one of the very few IT companies to have a Kolkata facility since
the mid nineties. While TCS has been one of the fewer companies to do so, most
of the other IT majors have always come back to Kolkata to recruit talents,
especially freshers, in campus placements. Says Amitabh Ray, vice president,
global delivery of IBM in Kolkata, “Our experience in terms of the captive
talent pool in the State has been very good so far.” IBM Global Services has
two facilities in the city with a workforce of 40,000, which makes Kolkata its
second facility. 

"We set up operations in Kolkata primarily to tap into the high quality talent pool, availability of good office space, cost of operations, expeditious support from the state government and nodal agencies like Webel" -Siddharta Mukherjee, VP and head, Operations, CTS

Homegrown software company RS Software swears by the local talent pool. Says
Raj Jain, managing director, RS Software, “According to our experience, we
feel the local talent offers a lot more stability in addition to quality.” RS
Software operates out of two centers, its corporate office is at Kolkata in
addition to its US branch. The company that concentrates mostly on lateral hires
has 80% of their manpower strength of 500 at Kolkata.   

Cognizant Technology Solutions (CTS), one of the first software companies to
set up a global delivery center at Kolkata, has recently announced that it will
hike its manpower strength in the city to 3,200 by the year end. Says Siddharta
Mukherjee, VP and operations head in Kolkata, “Cognizant set up its operations
in Kolkata primarily to tap into the high quality talent pool, availability of
good office space, cost of operations, expeditious support from the state
government and nodal agencies like Webel.” Recently, CTS has signed an MoU
with Calcutta University wherein the University will train an initial batch of
400 CTS professionals. In a media address post the MoU, Mukherjee said that the
MoU would also allow Cognizant to recruit from across branches and disciplines
of study in the future.

While the quality of the engineering talent pool is proven, Kolkata also
fares highly in terms of the overall quality of talent. According to a recent
survey by Bangalore-based recruitment processing consultancy MeritTrac, it is
not Bangalore, Hyderabad or Chennai, but the eastern states that provided the
best English speaking talent pool to the BPO industry. East scored the highest
in parameters such as accent, fluency and grammar, and the National Index for
East at 85 was the highest among all regions. Analyzing the performance of
10,500 graduates across 17 cities through a spoken English test arrived at the
index.

Kolkata offers the additional advantage of low attrition rates. When the
industry is reeling under high attrition numbers-between 40-60% for BPOs and
around 15-20% for software, the attrition rates are far lower in Kolkata. TCS,
for example, has an attrition rate of 7% as opposed to the national average of
nearly 10%. Says TCS' Mukherjee, “From the TCS point of view, attrition rate
is the lowest in Kolkata.” 

Home is Where the Heart is...

Most of the IT and ITeS companies that are present in the city today prefer
to hire talent locally. Kolkata has the obvious advantage of a surplus talent
pool. Hiring the same talent and relocating them to other cities always works
out to be a more expensive proposition for companies. Several studies conducted
show that the average cost of living in Kolkata is 20-40% lower. While this
differential is slowly narrowing, Kolkata is still works out to be a far cheaper
alternative for companies.

Given the geographic spread of the IT industry, the IT workforce is required
to be extremely mobile. In reality, the actual situations faced by companies are
exactly opposite. Says RS Software's Jain, “The IT workforce is far less
mobile than we would like it to be.” Says Mukherjee, “TCS has always
believed in creating offices in different locations because, over the years, we
have seen people show a preference towards a location that is closer to their
hometowns.” Today, after nearly a decade in Kolkata, TCS has a workforce of
about 5,500 at the end of FY 2005-06, which is around 9% of TCS' total
workforce.

The Growth Challenge

While the state government is selling the state to every prospective
investor, how does Kolkata fare as a destination to the IT workforce? Is it a
challenge to attract people to Kolkata given that the glamour quotient is far
lower as compared to a Bangalore or even a Gurgaon. Says TCS' Mukherjee, “At
the junior level, people are more that willing to be located at distant
locations. Kolkata's image has not been a problem as far as we are
concerned.” Agrees CTS' Mukherjee. “Globally, much of Cognizant's
recruiting is localized. Location constraints do not exist, however. We have had
many people relocate to Kolkata on work requirements and they have been very
happy with the ecosystem there.” In the IT industry, the quality of work in a
company and career growth opportunities preponderate most other considerations
such as location. For the likes of TCS and CTS, it is the brand that scores over
the destination. “While we prefer to locate people closer to the hometown, we
get people from other regions to the Kolkata center according to our
requirement,” says TCS' Mukherjee.

The challenge is far bigger for smaller companies, which has to sell Kolkata
far more than a TCS. Ontrack Systems is a city-based company that is into areas
such as managed services, application development, product development and ERP.
Says Debarshi Roy, vice president, global delivery center, Ontrack Systems, “I
think the single-largest problem with Kolkata is that there is no segment
between the large and the small players.” True, Kolkata's image is no longer
an issue in the industry. Both the IT and ITeS industries realize that Kolkata
is today one of the strongest centers of growth. However, it is problem of
growth as far as the IT workforce is concerned. The ideal career chart is a
gradual progression from a smaller to a mid-tier one and then to a large brand
for a significant section of the workforce irrespective of the industry to which
one belongs. With the mid-tier missing in the region, there is a challenge for
companies like Ontrack Systems to attract talent from other destinations to
Kolkata.

Completing the Ecosystem

This ecosystem is not just about issues such as bandwidth, an
investment-friendly government, availability of talent pool and a suitable
climate for the IT industry to grow, but an ecosystem that would create the same
glamour quotient for the city. Says Mukherjee, “There might be a bias against
the East as far the IT workforce, typically, is concerned.” Tanmoy Chakraborty,
VP & head, Global Government Industry Group of TCS has a solution-that is,
give them what the want and what they are used to. “The IT workforce is an
upwardly mobile one and you need to given them the right kind of ambience and
excitement in life to attract them to Kolkata,” says Chakraborty. Agrees
CTS' Mukherjee, “IT is not an island; it's a part of an ecosystem which
will have a strong influence on how IT flourishes in West Bengal. Key
constituents of the ecosystem include education, healthcare, infrastructure and
social amenities. A singular focus on IT alone may get good results in the
short-run but it is the ecosystem that will sustain it.”

The government realizes this and currently efforts are on, both on the
government front as well as private, to set up the perfect ecosystem. Private
infrastructure player, DLF, that has largely been instrumental in transforming
Gurgaon from a Delhi suburb to one of the hottest centers of habitation and
industrial growth for the IT industry has set its eyes on Kolkata now. DLF will
be pumping Rs 3,000 crore into the state to build housing complexes, shopping
malls and IT Parks. DLF wants to replicate Gurgaon in Rajarhat, the second IT
hub in Kolkata after Sector V. While everybody agrees that Kolkata will take
some time to become a Bangalore, overall spirits remain high. Says Rajendra
Chamaria, chairman & MD of Infinity Infotech that has come up with Infinity,
the first IT Park in the city, “I feel that it will take Kolkata another five
years to become a Bangalore.” That's good news, for sure.

Bhaswati Chakravorty

bhaswatic@cybermedia.co.in