2. Airlines may get more time to phase out expat pilots
The central government may extend the deadline for Indian air carriers to phase out foreign
pilots. In a move to help Indian flight operators deal with the shortage of pilots , the Directorate
General of Civil Aviation (DGCA) has asked all leading players to submit a five-year hiring and
training plan.
The industry regulator, in its June 2008 order, has shown strong opposition against foreign pilots
manning domestic flights as they are not adequately familiar with Indian airfields and weather.
Also, there are some 3,000 Indian pilots, who are still looking for jobs.
This will not be the first time DGCA is re-looking to postpone a phase-out deadline for expat
pilots. In April 2010, DGCA agreed to extend the deadline from June 2010 to July 2011, subject
to validation of their foreign licence by DGCA.
In a much-awaited relief, DGCA had asked airlines such as SpiceJet, Air India, Jet Airways,
Kingfisher, IndiGo and Go Air to give a detailed five-year plans of foreign and Indian pilots that
they plan to hire. Air carriers will also have to submit the number of local and expat pilots
currently hired by them along with their training plans.
Further, they will have to provide information on how they plan to ensure career progression of
Indian pilots. “Technically, it is unrealistic to expect that the deadline can be adhered to. The
industry cannot be grounded,” said a senior official from civil aviation ministry on the basis on
anonymity.
Airlines’ association, the Federation of Indian Airlines (FAI) confirmed the development. FAI
had made a representation to DGCA on the rationale behind hiring expat pilots for the next five
years. “We need a healthy mix of Indian and expat pilots for the industry to grow. DGCA has
agreed to relook at the issue,” said two people close to the development, who did not wished to
be named.
Three years ago, when this rule was announced, DGCA had got a number of representations
from airlines here, which said their services would be severely affected and many planes
grounded if the July 30 deadline is not extended. In a latest development, airlines have asked
DGCA to open up the sky for recruiting foreign pilots for an unlimited period. The model is
currently followed in the Middle East and South East Asia.
“Yes, it is true that DGCA has asked us to submit details of hiring pilots for the next five years
and all three full-service carriers have submitted it. We need to open up the hiring of expat pilots
for the industry to grow,” a full-service carrier spokesperson said on conditions of anonymity.
As per the industry estimates, there is a shortage of type-rated commanders with airline
operators. The industry estimates peg the shortage at 300, at present, this will swell to nearly 700
once a government order, which bars expat pilots, comes into effect from July 2011.
3. The problem is going to further aggravate for low-cost carriers, such as IndiGo, SpiceJet and
GoAir, which are estimated to more than double their fleet size to 130 in the next five years.
Full-service players, such as Jet Airways, Air India and Kingfisher Airlines , which together
operate nearly 350 aircraft, too, are expanding. The country’s biggest private airline Jet
Airways plans to increase its capacity by 15% this year.
“The demand has increased and the only way airlines can manage it is hiring a good core team of
expat pilots. It is important for airline to attract talent as there is a huge shortfall. Expat pilots are
required for the next 3-4 years,” said a senior official from SpiceJet requesting anonymity.
SpiceJet plans to hire 50 pilots, of which 10-15 will be expats, for both domestic and
international operations. The low-cost air carrier has 200 pilots, of which 14% are expats,” he
said. While Air India has written to DGCA seeking an extension as it expects delivery of its
Boeing 787 in 2011.
“The delivery schedule of B787 will have an impact on requirement of pilots, including
expatriate pilots. We have asked DGCA for extension as there is a shortage of type-rated pilots,”
said a senior official from Air India.
State-owned Air India has 153 expat pilots and will promote 50 co-pilots with sufficient hours as
commanders. Despite this, the airline will have a shortage of over 100 pilots.
Jet Airways and Kingfisher have around 200 expats. Both of them are also trying various ways to
phase out expats. “We are optimistic that DGCA will consider the issue and allow airline to hire
foreign pilots if they expect the industry to reach some capacity. We do expect the regulator to
announce some measure in the next 45 days,” said a senior official from one of the leading
airlines.
At present, there are over 600 expat pilots, who are employed by five major Indian scheduled
operators — Air India, Jet Airways, Kingfisher Airlines, IndiGo and SpiceJet. The DGCA
programme to phase out foreign pilots had resulted in their numbers reducing from 944 in 2008
to 686 in 2009 to 600 this year.
4. Infosys bets on training to groom leaders
India’s second largest technology firm, Infosys, is putting a new premium on internal training as
it looks to groom employees for leadership roles in its various ventures.
The company plans to increase its training budget by 24% next fiscal to $230 million, and has
already hiked training time by 10 weeks to 29 weeks.
HR head and director TV Mohandas Pai said Infosys plans to reward employees by offering
more leadership positions. This fiscal the company filled over a dozen leadership slots through
its internal, ‘open market place for leadership’ initiative.
Most recently, the senior VP of its BPO arm, Swaminathan Dandapani, was elevated as CEO of
Infosys BPO. By increasing training time, Infosys Technologies , which provides technology
services to global customers like British Petroleum, DHL, JP Morgan, Citigroup, Royal Philips
Electronics and Goldman Sachs, is preparing employees to handle the large transformational
contracts.
For instance, for its retail customers Infosys offers system integration services, technology
support, customer help desk, supply chain management and is also developing new e-commerce
platforms for at least six of the top eight US retailers. For a global communications major, it’s
developing 4G wireless solutions.
“We want employees to understand context of the customer, equip them with better business
acumen so they can offer solutions and options for clients and not just routine services,” said Tan
Moorthy, VP & Head (education & research), Infosys.
The transformation type of contracts, like the ones that IBM and Accenture do, call for
understanding the way customer does business and try and evolve new and better ways to do it,
which is different from traditional system integration, testing or coding kind of projects that
technology companies like Infosys have been used to.
According to Chandramouli CS, director-advisory services at Bangalore-based Zinnov
Management Consulting, intellectual property-led growth and utility solutions are on the radar
5. for service providers. “Executing business transformation projects requires lot more conviction
and confidence, ability to think and articulate solutions to clients. Definitely demand for such
talent followed by training is going to be high,” he said.
A strengthening rupee and higher employee costs are also forcing companies like Infosys to go
for the higher value services and eventually delink revenue and manpower growth.
Adds Rishi Das, founder & CEO, CareerNet Consulting, (a Bangalore based recruitment firm),
“Expanded training needs have been fuelled by hiring non-engineers for technology services jobs
and for better productivity gains. The market has improved, yet its tough to get the more
complex business which gives better margins, hence the emphasis on training.”
Corporate executives can expect a good rise in
bonuses
India’s factory output has moderated to a growth pace of 7.1% in June and had fallen short of
analyst’s estimates but the factory output expanded by 11.6% in the first quarter of the current
fiscal as compared to last year and it is now expected that full year growth could touch 9%.
As Indian sentiments—the current political philosophy and overall economic growth in the
country—show a positive trend, companies are also more than likely to follow a robust
performance plan. It looks like an open sesame for new job seekers as corporates are pitched to
go after them for hiring and retention.
Appraisals seem to be over in most organisations and even government of India has decided to
reward its hardworking parliamentarians with pay hikes. Corporate executives can expect a good
rise in their bonuses as the economy is recovering and the last quarter results have also been very
positive. This is the time to invest in human resources.
There is certainly no doubt that companies need happy employees along with healthy bottom
lines and great savings. Adding a few new benefits to an organisations repertoire can make their
business more attractive to prospective employees, help retain performing employees and
provide an edge against competition.
The improving business environment catapults the need to introduce more and effective
incentives and remunerations for the workforce. In India, the linkage with performance has
6. started now. Today approximately 30% of an employee’s pay, across sectors, is variable. Many
companies are also consciously adding non-taxable components and variable incentives to
motivate the team other than the usual festival payouts, performance based bonuses and the trend
will only continue over the next two years.
This year has been very positive for the companies. Consumer sentiments have been very
positive. Manufacturing growth was strong during this quarter, as indicated by the Index of
Industrial Production. Construction growth is likely to have been healthy; service sector has also
supported overall GDP growth. Looking at these, companies should announce an impressive
bonus during the festival season.
Other than monetary incentives, companies can invest in training of human resources. Last year
because of cost cutting many companies had to discontinue certain initiatives. Again we can see
employee benefits like foreign travel, gift vouchers and overseas training coming back. These are
some measures, which an employee looks forward to. It is a moment of pride for him and it also
encourages the employee.
If companies can make performance bonus effective for employees, it adds tremendously to its
equity and bank of loyal brand ambassadors. In order to build loyalty among employees,
companies should provide fair opportunities for their career growth. Variable pay must be linked
with the performance.
In a talent starved industry, it is difficult to find quality employees and even more difficult to
retain them. But with apt HR practices and compensation, companies can retain the talent pool. It
is all about creating the right environment, one that is in sync with the company’s and also the
employee’s growth ambition.
Suspense's over, UK chooses TCS for 10-year
pension deal
The coalition government in the UK has confirmed the 10-year contract for administration of the state
pension scheme awarded to India’s top software exporter Tata Consultancy Services (TCS), ending
months of uncertainty over it. The contract is valued at around £600 million (over `4,000 crore).
The confirmation of the deal also indicates that Indian outsourcing vendors will be well-considered by the
7. new government in the UK, as it embarks on a drive to cut a massive £83 billion in spending. ET had
reported, in its edition dated October 22, that the pensions contract or Personal Accounts Delivery
Authority (PADA) project, may stay with TCS. Awarded by the previous Labour government, the project
had attracted criticism from the Conservatives — who are now in power along with Liberal Democrats —
and was widely expected to be cancelled.
“TCS is delighted that the government and the National Employment Savings Trust (NEST) have chosen
to move forward with the second stage of the Scheme Administration service contract which continues to
build on the work already started in stage one. TCS believes that this project will have a significant and
positive effect on millions of people in the UK in helping them save for their future,” said N
Chandrasekaran, CEO and MD, TCS.
Friday’s official announcement by NEST Corporation, the trustee body of the NEST, puts these fears to
rest. NEST said it confirmed the long-term contract for the administration of the pension scheme until
June 30, 2020, with the option to extend it for a further five years.
The PADA contract consists of two phases with the first phase being worth only a fraction of the total
contract at around £25 million. Had the deal been cancelled after the first phase, TCS would have
invested a significant amount of resources, but would not have gained proportionately with a long-term
contract.
“We are fully committed to the project and believe that it will create real value for UK society and will
deliver a world-class product for its citizens,” said Mr Chandrasekaran. Steve Webb, the new minister for
pensions in the UK government, termed the contract as a significant milestone. The contract covers all
aspects of scheme administration, including web-based enrolment, record keeping, contribution collection
and details of each individual’s retirement fund.
“Key elements of NEST are falling into place as planned. We are appointing global leaders in their fields,”
said Tim Jones, chief executive, NEST Corporation. “This is the first of a series of announcements that
NEST will make over the coming months, as we complete our preparations for accepting business from
volunteer organisations from the second quarter of next year,” added Lawrence Churchill, chair, NEST
Corporation.
3rd August,2010
Gopalakrishnan to step down from Tata Motors board
8. ata Sons director R Gopalakrishnan will step down from the board of Tata Motors as the $70-billion salt-
to-software conglomerate plans to increase the number of executive directors on the boards of its major
companies.
India's biggest conglomerate, which has increased the number of executive directors in key group
companies such as Tata Chemicals , Tata Power and TCS, now plans to extend this to the two biggest
listed companies, Tata Motors and Tata Steel, according to a person familiar with the matter.
A Tata Motors spokesperson said Mr Gopalakrishnan, 64, had decided not to offer himself for re-election
as a director because of what he said were "personal reasons". India’s largest automobile company,
which in March appointed Carl-Peter Forster as CEO and MD, has nominated the GM veteran to its
board.
His appointment will have to be ratified by shareholders at the annual general meeting. Ranendra Sen,
former Indian ambassador to the US and an architect of the Indo-US nuclear deal, has also joined Tata
Motors board as a non-executive director from June this year.
Tata group veteran NA Soonawala resigned from the board as non-executive director in March.
Though Tata Motors is not bringing a new face in place of Mr Gopalakrishnan, whose term expires in
September, an executive director is likely to be appointed in due course, according to a person familiar
with the subject. "Carl-Peter Forster and PM Telang are the two executive directors on the board. The
company may look at appointing more executive directors," he said.
Other Tata Group companies have more executive directors on the board. The group's power utility major
Tata Power has four, including its managing director Prasad Menon. Software major TCS has its MD N
Chandrasekaran, CFO S Mahalingam and Phiroz Vandrevala on the board.
But Tata Motors has only two executive directors and Tata Steel’s managing director HM Nerurkar is the
only executive director on its board. Sebi has recently amended the Clause 49 agreement, saying that the
number of independent directors should either 33% or 50%, depending on whether the chairman is non-
executive or executive.
Since the number of non-executive directors is more in Tata Motors — nine non-executive directors
compared to two executive directors — the company does not to wish to fill the post to be vacated by Mr
Gopalakrishnan.
