In the first quarter of 2007, Tata Consultancy Services (TCS) went on a recruitment drive to nearly 43 technical colleges.
Among these were Valliamai Engineering College, Kattankalathur; Adhiparasakthi Engineering College, Melmaravathur in Chennai; Shaheed Udham Singh College of Engineering & Technology, Tangori, Punjab; G B Pant Engineering College, Pauri Garhwal, Uttarakhand - not exactly the kind of institute you would expect a company like TCS to hire from.
In reality, however, 70 per cent of the more than 30,000 people TCS hires annually are picked from tier 2 and 3 cities.
"We've found that recruits from smaller towns increase the retention ratios in our organisation," says Thomas Simon, vice president (human resources), TCS. By cherry-picking skilled graduates from smaller towns, TCS has supplemented the talent it gets from the top schools.
High attrition rates (16 per cent for the BPO-ITeS segment and around 14 per cent for the IT industry) are, of course, an important reason why companies like TCS, Genpact, IBM Daksh, Aricent and Patni are turning to colleges in small cities.
The other reason: the IT industry, which will hire an estimated 4 lakh people this financial year, needs to plug the huge demand-supply gap. No wonder, little known colleges and their students are finding a place on the IT map.
Look at Genpact. The company has opted for remote recruiting processes and has 17 dedicated hiring offices in cities like Agra, Lucknow and Dehradun. "Students from tier 2 or 3 campuses are not enough to justify a full-scale company visit, thus remote recruiting works well," says Rajiv Wadehra, vice president and hiring leader (Hyderabad centre), Genpact.
IBM Daksh too has added cities like Jaipur, Bareilly to its talent-acquisition list. "Earlier we used to advertise a lot and wait for the responses. Now, we go to candidates in tier 3-4 colleges, having identified a few regional graduate colleges as potential talent pools," explains D P Singh, vice-president (strategic HR), IBM Daksh.
The company runs 3-week long training courses for fresh recruits, to fine-tune skill-sets through rigorous workshops and training modules.
No company looks at just the top 5-10 campuses today; it prefers, instead, to go to 20-30 tier 2 and tier 3 campuses across states. Scope International, the global shared services centre of the Standard Chartered Group, has gone to towns like Coimbatore, Salem, Trichi and Tanjavur.
"Since 2006, the number of candidates being offered positions at Scope from these towns has gone up substantially. We selected over 250 candidates in 2006 and 360 in 2007," says Shashi Ravichandran, head (corporate affairs), Scope International.
Nearly 20 per cent of the 1,000-odd candidates Patni claims to hire from campuses come from colleges in cities like Vizag, Coimbatore, Madhurai.
Kalpana Jaishankar, vice president (people development & HR Operations) says, "We started sourcing talent from colleges that are probably not the best, yet are breeding grounds for IT-related skills."
The company still hires from the IITs, regional engineering colleges but reckons the number of employees from smaller colleges is bound to go up.
Hinting at weaknesses in the traditional visit-the-campus system, Indrajeet Sen, director (talent acquisition), Aricent states, "You can only visit a few campuses and even those, maybe twice a year. Again, operating recruitment sessions is expensive and one might not get a 'prime' slot, if you are not considered a viable employer by top candidates." There is also an unspoken reason for companies finding talent from tier 2 or tier 3 cities.
Scouting for talent in metros and larger towns is expensive as rival companies are ready to pay premium salaries to get the best graduates and engineers.The cost of acquiring candidates at the entry level jobs for most IT, ITeS companies is estimated to be 15-17 per cent less than those in the metros and tier 1 cities.