Skills at immediate risk of obsolescence, half life of skills dropping

A Snapshot of Workplace Transformation

·      Half Life of Skills is Falling Sharply. A skill which is crucial to your job today may well be irrelevant in the coming year due to the impact of technology.

·      Simple skills are becoming redundant with new technology replacing repetitive and low skill tasks: eg: Data entry and Voice Positions

·      Employers are looking for employees with technical aptitude

·      Unlearning – to be able to move beyond a fixed mindset of problem solving

·      Educated workers are more at risk as services jobs get affected       

Absorbed with their to-do lists and set of tasks, professionals have little time to worry about the wider relevance of their skills. There is no time to stop and study the changing nature of skills, jobs or even business process changes that is shaping white collar jobs across the country.

The nature of jobs is changing rapidly almost at an exponential rate, and the pace is so fast that it cannot be mapped. Human minds can comprehend linear change but when the graph becomes exponential in nature it is impossible to do so. It is considered better to ignore it as an anomaly.

Maybe it is time to do a skill inventory and evaluate which of your skills are fast becoming irrelevant as machines become more intelligent.

Shrinking Half-Life of Skills! 

Let us put the human brain capacity and machine intelligence into context. The human brain is capable of doing 10 raised to the power 16, calculations per second, and it is static. This was surpassed by a super computer in 2018. Now, this does not automatically mean that computers have reached singularity or surpassed human intelligence. It means that human brain capacity is not growing while machine intelligence is growing exponentially.

Due to their growing relevance in the workplace, this puts more jobs at risk in the services sector than previously assumed. In India, it is the services sector that has been the driver for job growth for the better part of two decades. Within the services sector the fastest growth was clocked by services firms catering to global customers. According to NASSCOM, the BPO or the BPM (Business Process Management) services market in India is fragmented and diverse with nearly 500 outsourcing companies catering to 35 different languages around the world. Voice support, simple data entry and enquiry jobs were at the lower level of the skills spectrum. These jobs are expected to now disappear completely in the next 18 months, according to industry experts. Approximately 10%-12% of the more than 1.2 million jobs in the BPM industry are in voice. While BPO jobs are estimated to be growing, this is at a slower rate, and many call center positions have been migrating to Philippines, and now the technology wave is expected to hit this space. 

In particular, Chatbots and voicebots are taking over the voice based support jobs rapidly. Data entry jobs too are being taken over by the rapid growth of process automation software that can read all kinds of writing. 

At a recent NASSCOM Roundtable on Chat Emerging as the New Frontier of Digital Customer Experience held in March 2019, participants from the E-commerce sector, retail lenders and even FMCG companies discussed the rapid and abrupt migration towards chatbots. Since, E-commerce platforms, banks and finance companies operate large call centers, these sectors are poised for much disruption.

More companies want to shift to chatbots as their customers are increasingly comfortable with text based chats rather than traditional voice. Moreover, voice based bots are becoming more intelligent. Google Assist, Siri and Alexa have shown that voicebots can understand Indian accents and even multiple India languages. This helps people who cannot write or do not want to write on chat to engage by another channel. According to the State of Chatbots Report, a joint effort between Drift, SurveyMoney Audience, Salesforce and myclever published in 2018, the expectation that chatbots are more efficient in response times than a face to face or a telephone call is evident. The capability of the chat bot platform is growing exponentially and 70% of the enterprises expect it be the primary point of customer contact by 2020.

The head of the largest private sector bank said off the record that their 3000 people voice based call center for complaint redressal and onboarding is becoming redundant. He added that “they are being trained for cross selling of products.” Selling financial products on the telephone is a higher level skill and usually more suited to extroverts. Not all employees are successful at it. Therefore, the skills that are most at risk of being outdated are comprehension, linguistic, cognition, customer support and query redressal on a database.

It is important to note that there are companies which are betting that voice will not go away. “There will always be a set of older customers who would prefer to speak to a human being and may not be comfortable with new interfaces”, says SM Gupta, Chief People Officer at AEGIS Global. The company serves multiple geographies in multiple languages and employs more than 50,000 people in voice processes.

The senior HR head of BPM company argues that, “The lowest skill for people at entry wage level was to know reading, writing and typing…there are very few jobs for such skills left any more. Now you need some amount of technical aptitude too. Which either you have or do not have therefore a clear distinction is emerging among employees who can be retained in the long term“.

Notwithstanding some exceptions, most BPM companies are feverishly planning for the voice disruption to take hold. The largest BPM company, Genpact has been working overtime to reskill its employees at a pace never seen in the past.

BPM service engine slows down

Business Process Management companies deserve a lot of the credit for driving the growth of services jobs in the country. BPMs are a $28bn industry and emerged due to technological arbitrage that allowed global jobs to come to India. It was the port of call for newly minted graduates from small town India looking for entry level jobs. However, the slowdown is evident with the sector adding the least number of jobs in the last 7 years. Within the BPM industry the most affected area is the customer support jobs.

In a short history of two decades, customer support services (CSS) has grown rapidly. First, during the outsourcing boom, and then later by servicing domestic telecom companies. Along with telecom, was the rise of the private sector banks that also needed support for onboarding. When these two industries matured and their customer support demands reduced due to pressure on margins, the domestic E-commerce industry and payment wallets took off.

However, after years of strong growth, the hiring spree in this sector has met with an abrupt slowdown. While E-commerce sector has undergone a consolidation and headed towards a duopoly they are also reducing their losses and investing less in people and more in technology. These customers are often millennials, tech-savvy and keen to chat with customer care than with calling up a helpline. The NASSCOM Strategic Review 2018 estimated that there was a net addition of only 36,000 employees in FY2018, a far cry from the 100,000+ brought onboard in 2009 and even the 66,000 who joined the sector as recently as FY2017. A sizeable chunk of this deceleration in net hiring is due to automation in the sector. 

Soma Pandey, CHRO at Firstsource Solutions sums up the current trends by saying that “We have seen a lot of automation come in- typing and data entry work has gone away replaced by optical character resolution automation software.”

Piyush Mehta, CHRO, Genpact weighs in, “That automation is rising and increasing is largely a secular trend and the technology which gave rise to the BPM industry is at the center of its disruption.” He adds in quick succession that this does not mean the end of the industry or anything ominous for the sector, it just means that companies need to adapt and prepare for the change much faster than in the past. Genpact as an industry leader is ahead of the curve in preparing itself and its own employees for this disruption by upskilling them. The same cannot be said for all the companies in the sector – some out of choice and some lacking adequate capacity. 

Given the importance of these jobs in the Indian economy and their presence in key commercial hubs across the city, some of this disruption is going to have an effect at both the city and the country level. Several cities emerged as hubs for global services but now voice positions and other low skill jobs have begun to disappear across Noida, Jaipur, Indore, Ahmedabad and Hyderabad. A large population of young employees with similar skills will be out of jobs and fresh graduates will be unable to find employment. 

Source: State of the Chatbots Report

Impact on the economy and GDP

The BPM sector and its continuing drive to adopt new technologies cemented India’s position as a global commercial hub, in the process being a driver of employment generation. The overall back office industry is approximately 8% of the GDP. Moreover, according to the Indian Brand Equity Foundation, the Indian BPM sector accounts for 37% of the global BPM sector. As a result, it is a significant contributor to India’s export revenues. Any slowdown in this employment intensive sector has a disproportionate impact on jobs.

However, technology which ushered in the rise of the sector is now disruptive to growth but also the fundamental people based model of this industry. The slowdown of BPM as a major job engine means that the overall job growth in the services sector will be hit. Unemployment numbers are already reaching above 6%. Until now, skilling programs have focused on preparing young graduates for entry level jobs, but these jobs are now at risk. This is an important issue and Indian policy makers should prepare young graduates keeping in mind the reality of the situation. The education and skilling policies must rapidly evolve as they have to take into account even employees with 5-10 years of experience too who will be displaced during this round of disruption.

 --ends