[nukkad] ERP Reality?

["Amit A Mayekar" <Amit_A_Mayekar@ril.com>]

----------------------------------------------------------------------------
Tip of the day:  Do not include the entire message in your reply. Include only
the relevant parts.
----------------------------------------------------------------------------

ERP: Access Denied
Yesterday's hot opportunity turns into today's nightmare as corporate India
closes its doors, says Manish Khanduri
It's cracked wide open. The lure that made thousands of professionals and
students dream of huge salaries and exciting job opportunities has proved a
mirage. Two years ago Enterprise Resource Planning (ERP) was the hottest
employment opportunity for professionals in fields as diverse as soft
goods,
steel and pharmaceuticals.
They spent millions on full-time training from institutes that promised
astronomical dollar salaries in the West. Most, including 40-50 year-old
professionals, quit safe, well-paid jobs in a time of recession to gamble
on
the future. Today, many are still unemployed.
Don't believe what you're reading? Consider these facts and remember some
of
the figures are under-estimates:
*Industry estimates suggest that 7,000-8,000 people, or some 50 per cent of
India's trained ERP manpower, are jobless. That number is climbing. Some
have been jobless for more than a year.
*Industry observers say almost 90 per cent of ERP school-trained candidates
who today apply for ERP-related appointments are unemployable and will
never
get a job.
*Four months ago IT major Wipro had a job requirement for four ERP trained
professionals, 1,500 people applied.
*A fledgling ERP startup in Delhi recently advertised for ERP
professionals.
Around 1,200 turned up in Mumbai alone; eight were hired there.
Thousands of professionals are reaping a bitter harvest after the manic
seed
of ERP was sown in India two years ago. The reasons for this include a
boom-driven oversupply, a slowdown in corporate demand and a complete lack
of genuinely qualified personnel.
There's no hope of change. Not with people between the age of 25 and 50
roaming jobless, offering to work at ERP implementation for a pittance and
sometimes, says Satish Doshi, managing director of IT placement company,
Sampoorna Computer People, "for nothing at all". Doshi gets 300-400
ERP-related CVs every month and finds only 5 per cent of them worth his
while. Another IT placement consultant, Anil Divate of Fidelity IT Jobs,
says, "I have a thousand CVs of ERP-qualified candidates. Only 20 are
placeable.
The crux lies in the changing nature of overseas demand, and the
unrelenting
logic of Indian markets. Two years ago the basic two or three months
training at an ERP institute in India could have qualified you for a job
abroad. "Foreign companies were then desperate for trained manpower, any
manpower," recounts Divate. Today? "Don't even think about it," he warns.
In
other words, if you don't have hands-on experience of an ERP project, you
have no chance of getting a job abroad.
And perhaps not even in India. For placement agencies such as Sampoorna and
Fidelity, six months of experience is the bare minimum requisite demanded
of
a candidate.
For most ERP-trained hopefuls, this is proving an insurmountable obstacle.
You can't get that job abroad if you do not have implementation experience,
and getting that in India is becoming well-nigh impossible. Rajesh Tolia,
runs a computer and ERP training institute, Karox Technologies: "Companies
now ask for people with experience of at least two or three projects but
the
point is where do you get such experience, since so few companies use SAP
(one of three major providers of ERP solutions)?" An official at Datamatics
Corporation, a Mumbai-based placement agency, says their success ratio in
placement has been one in 100.
It's hard to explain why this is happening. Indeed, studies of ERP-related
job opportunities look good. A recent Nasscom study says in 1998-99 the ERP
services market in India is expected to gross Rs 520 crore (Rs 100 crore =
Rs 1 billion) over Rs 280 crore the year before. By 2001, the report
expects
ERP-based billings to gross Rs 18,000 crore.
Observers say ERP implementation in India could be slowing as priorities
change. Vivek Kulkarni, senior manager, BaaN Company, one of the Big Three
solutions providers, acknowledged that "there has been a slowdown in 1998.
I
think it's because companies are currently more involved in Y2K projects".
Others suggest that the reality never was anywhere near as rosy as the
statistics projected in the first place. Indraneel Mukerjee, manager
marketing, SAP India, says, "For SAP it is a question of trying to take a
reality check on the huge growth rates we expect rather than the other way
round."
It is also true, however, that ERP implementation is expensive - the bill
can run into tens of crores - which could be especially tough for firms hit
by recession. "We keeps hearing reports that companies have backed off from
implementation because it is expensive and because in these recessionary
times they do not have the money to pay for it," says Doshi.
A few months ago a senior consultant with a Big Five management consultancy
firm had told Business Standard that of the 150 installations then in the
country "130 have run into some trouble or the other". The Lloyd Steel
project is one example; according to sources in HCL Infosystems, which was
implementing SAP solutions for Lloyd, the company decided to stop midway
through the project.
As a result, ERP pros are feeling the pinch like never before. Take
Mumbai-based Suresh Iyer. He left a well-paying job at software megalith
TCS
in favour of an ERP course. He completed his course about three months ago,
is yet to find a job, and today trains new batches at an institute he has
started. He says, "The market is not yet mature enough to absorb the huge
number of professionals the institutes are churning out."
Today, there are an estimated 400 ERP training institutes in India, not all
of them authorised licencees of SAP, BaaN or Oracle. Most of them
mushroomed
when ERP became the flavour of the year with corporate India promising
lucrative placements. Indeed, many of them were able to place 60 to 70 per
cent of their initial batches. Today, there are no guarantees.
So who's doing the hiring? The recruiters' end of the market is broadly
divided into two segments, the ERP implementers and the companies
undergoing
ERP. The first category includes the big five accounting firms,
implementation partners and associate implementers. Implementation partners
are companies such as Siemens and HCL Infosystems for SAP and DSQ Software
for MAPICS and PRISM that have been authorised by the ERP majors (SAP or
BaaN or Oracle) to implement projects. Associate implementers, such as
Eastern Software Systems for Siemens, are the companies that work in tandem
with implementation partners.
And these people don't even want to hear from you. Ambarish Dasgupta,
executive director, at PricewaterhouseCoopers (PwC), says he gets "15 to 20
CVs a day, an equal number of telephone enquiries, not counting the e-mails
from ERP professionals abroad." A S Viswanathan, director, Siemens
Information Systems Limited, says his company stopped advertising more than
a year ago. Very few, including companies such as HCL Infosystems and
Eastern Software or Polar Software, are even willing to look at a resume
that carries no implementation experience.
Recruiters say most people who apply are unfit for ERP implementation in
the
first place . States Doshi, "Most people are unfit for the job, their
training in no way qualifies them for implementation." In the two years
since the mad rush for ERP began, the market is bursting at the seams with
what Anil Bakht, managing director, Eastern Software Systems, says are
"so-called professionals who by rights should never have been there in the
first place."
There is a yawning gap, recruiters and placement agents say, between
someone
who is "fit" for ERP and someone who isn't. "Just because you have worked
in
finance or material management or sales doesn't mean that you can do an ERP
course and become a master implementer," says Doshi.
And when crores can ride on an ERP implementation no one wants to take a
chance on a dubious candidate. Every organisation seems to have developed a
solution to this problem. Most implementers hire people directly from
industry and train them in-house. States PwC's Dasgupta, "We look at a
person's functional experience, the company that he has worked for and the
college he graduated from. All of these have to be top-notch. We rarely
recruit anyone fresh out of college." Companies undergoing implementation,
such as the Mahindras, often prefer to train their own employees.
Implementers too, like PwC, Siemens and HCL Infosystems, all have their own
internal training programmes.
And yet they keep "graduating" in droves, spending lakhs on dubious ERP
courses that promise them the earth. For these thousands there is no end,
only a hard reality. Companies are hiring, definitely, but in dribs and
drabs. For instance Wipro plans to recruit around 25 people soon, HCL
Infosystem has an ongoing programme, as does Eastern Software. But it's
employees in organisations implementing ERP programmes who have become a
favourite target these days.
Even if the job market eases, ERP "graduates" may find still themselves in
a
tight situation. Organisations such as Siemens plan to set up their own
training schools. SAP India is soon expected to announce authorised
training
schools all over in collaboration with Indian partners who are yet to be
named but have been identified.
When that happens the market will be flooded by graduates from authorised
training schools. But for the moment, hope and desperation persist. " I get
calls from people," says Siemens Viswanathan, "who say they plan to
withdraw
their PF money and invest for their son in a training school. What does one
tell them?"
This is a article which can be found at:

http://www.business-standard.com/99feb13/wbiz1.htm
Thanks,




------------------------------------------------------------------------------
To Subscribe [Unsubscribe] send a blank message to 
        nukkad-list-request@mumbai-central.com 
with the word 'subscribe' ['unsubscribe'] (without quotes) in the Subject 
of your message.
The list is archived at  http://www.mumbai-central.com/nukkad/archive.html