In India and Beyond — Going to School for Procurement / BPO

Despite the fact that many US companies are finding it hard to identify the cost savings of years past from new BPO contracts -- thanks in large part to the weak dollar (at least until the past month) -- outsourcing is continuing to transform the Indian economy to a point that available skills have not kept up with demand. Consider this article from India Times highlighting "the acute skill mismatch in the labour-intensive BPO" industries and how "Genpact, has set up a JV, NIIT Institute of Process Excellence (NIPE) which has a mandate to train over 100,000 people in two years. All of the top 15 Indian BPO firms are likely to join the initiative." Indira Gandhi National Open University (IGNOU) also plans to get involved in skills training, entering into a deal with Accenture to offer "a diploma course to train students for jobs in the BPO industry." Among other areas, IGNOUs plans to offer courses to "support practices" in HR sourcing and category management.

In my view Western countries and companies can learn quite a bit from how India is dealing with its skills shortage. There's simply not enough emphasis on training and formal education here when it comes to procurement and supply chain. Sure, there are a couple of top-notch universities with degree programs in supply management (and even tip-top programs at MIT and others in operations research). But try going to a typical state university and explore, in any depth, the degree of both formal coursework and executive training offered in the procurement and supply chain arenas. It's not exactly stellar. Perhaps this is why Accenture, among other providers, has invested in building its Supply Chain Academy.

For profit training by a consulting firm is not necessarily the answer. I believe that corporations should get more involved with their local universities to fund and support procurement and supply chain research. Why research? To attract top talent -- both students and professors -- research funding is essential if we look at the history of higher education outside of liberal arts colleges. In addition, corporate research funding will support more pragmatic areas of research vs. esoteric ivory tower stuff (e.g., do we really care whether or not a reverse Dutch auction format works in an obscure category when there's a full moon?) Regardless, here's hoping that India's initiative will spur investment in similar forms of education in the West.

- Jason Busch

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