1. HRM Past >Present >Future >>> Presentation by Dayanand Allapur Head of Human Resources, Tesco HSC

2. 2 Paradigm Shifts in 3 decades post liberalisation mostly transactional Transform ation of IR into Personnel and HR Brain drain out of the country Booming of telecom and start up of IT Growth of mfg and services 1990’s Business Partnering role Transform ation of HR into a strategic function Migration of knowledge talent across country MNC’s and pure play Indian companies Growth of FDI in IT and ITES 2000’s Internal Consulting/ Customer facing Change in demographi cs, socio economic trends redefining HR Rural Indian emerging as key markets in retail Global orgs, MNC’s and strong Indian players Growth of ITES up the value chain and Growth of retail 2010’s

3. Evolution of Industry post liberalization 3 ● Liberalization - A historic decade in India ● Liberalized economic policies ● Contribution of Manufacturing & Service sector to GDP increased rapidly ● Overwhelming migrants out of India ● Exponential Growth of IT/ITES & Telecom ● Indian outsourcing valued at $60BN ● Direct employment 2.3mn. Indirect to 6.5 million ● Telecom contributed to 1% of the GDP ● Foray of 'Organized Retail Sector' ● IT/ITES to move up to knowledge value chain ● Retail industry to contribute 10% of the GDP ● 'Organized Retail estimated to reach US $50 billion by 2011 and to be worth US $ 175-200BN by 2016 with 25% pa growth ● Retail inching towards next boom in India 1990’s2000’s2010’s

4. Retail Industry in India 4 Retail Industry Opportunities 35% y-o-y growth in the last few years Raising consumption expenditure and disposable income Top 20 cities generated 60% of surplus income and 31% disposable income Efficient supply chains Ability to penetrate rural market Expected to grow at a CAGR* 23% to 25% between 2008 to 2022 Increasing size from Rs.96,500 crore (US $19 billion) in 2008 to Rs.17,36,000 (US $347to350 billion) in 2022 HR Challenges Skills unique to different segments and formats in organised Retail Demand side issues in Human Resource (Communication and other softskill, Lack of product/process knowledge, Poaching across industries, etc.,) Supply side issues in Human Resource (Limited training opportunities, Demand of manpower in big cities being met with people from smaller cities, finding higher skill level candidates in smaller cities, etc.,) Human Resource requirement (in 000’s): PG – 867 Graduate – 5202 Diploma/Vocational – 1734 12 th standard – 6937 10 th standard – 2601 CAGR: Compound Annual Growth Rate

5. 4% to 5 % Skill level 4 (skills which are highly specialized involving research and design) 30% to 33 %Skill level 3 (skills which require long drawn preparation as demonstrated by acquisition of degrees, and involve highly technical or functional skills) 10% to 15 % Skill level2 (Skills which require technical training inputs, knowledge of complex operations and machinery, skills of supervision) 50% to 53% Skill level1 (skills which can be acquired with a short/modular and focussed intervention and thereby enhancing employability of those with a minimal education) Skill pyramid for organized retail-emerging industry… 5 The skill pyramid, in summary, captures where the Organized Retail Industry stands relatively in terms of skills (a function of activity, educational requirements, and amount of ‘preparatory’ time required to inculcate a specific skill) as compared to all other industries. 4% to 5 % 30% to 33% 10% to 15 % 50% to 53 %

6. HR Challenges 6 Profession Art VS Science Influence Board Room Vs Department Perception Enforcer Vs Advocate Skill Transactional Vs Transformational

7. Evolution of HR in India post liberalization… 1990’s Transformation IR > Personnel> HR Policies, labour relations, Welfare, compensation, benefits 2000’s Strategic HR and Business Partnering Business partnering through performance management, training and development, talent management, quick development of broad based selection 2010 HR as Internal Consultants Transactional roles being outsourced, Transformational roles on building talent, capability, culture, consulting 7

8. Strategic Partner Strategic HR Planning HR as Business Partner Culture and Image Administrative Expert Comp & Benefits HR Info Systems Compliance Change Agent Talent Management Organizational Design Survey Action Planning Performance Mgmnt Training & Development Employee Relations Labor Relations Safety & Workers’ Compensation Diversity and EEO Four Roles and Sixteen Accountabilities – Ulrich’s model Processes People Day-to-day operational focus Future/strategic focus

9. The Future of HR Profession….  Some questions for us to ask ourselves….  What is the most compelling work in HR Today?  What skills/experience are necessary for the successful HR Professional today?  How will the way HR work done today change in the next decade?  How will outsourcing play a part in the future?  Will the HR function survive in the next decade? 9

10. The Future of HR Profession….  Some questions for us to ask ourselves….  What is the most compelling work in HR Today?  What skills/experience are necessary for the successful HR Professional today?  How will the way HR work done today change in the next decade?  Will the HR function survive in the next decade? 10

11. The Future of HR Profession….  What is the most compelling work in HR Today?  Globalization  Flawless execution  Partnering with executive leadership  Managing HR technology  Measurement / bottom-line impact 11

12. The Future of HR Profession….  What skills/experience are necessary for the successful HR Professional today? 1.Business skills-knowing how business works 2.Leadership skills-ability to create a vision & strategy 3.Consulting skills - focus on ability to market their work 4.Technology skills-proficiency in broad HR applications 5.Global mindset-understand dynamics of global market place 6.Change management 12

13. The Future of HR Profession….  Will the HR function survive in the next decade? 1.Its not about HR survival-but in what form & shape! 2.HR Function may get outsourced! 3.HR will have to learn “what” & “how” to Outsource! 4.HR must define standards / License for the profession 13

14. The Future of HR Profession….  How will the way HR work done today change in the next decade? 1.Dramatic shift in use of technology 2.Self service- web based technologies 3.Ever more sophisticated Call centers 4.Outsourcing- new meaning to HR internal & external 5.Cloud computing! 6.Globalization- work gets done with follow the sun model.. 14

15. HR The peoples business!  If businesses managed their money as carelessly as they managed their people, most would be bankrupt! - Ram Charan & Bill Conaty- “Talent Masters”