Feature

Interns for immediacy

Pressing needs and shrinking budgets have led companies to look for some immediate solutions to cut costs. Renuka Vembu analyzes how hiring of interns is helping IT organizations

Rising inflation rates and the resulting slowdown in the job market has meant that industries now need to grapple with increasing costs even when competition stiffens up and skilled resources are still dearth. Companies are looking at ways to curb costs to balance out their finances and revenues in the slump phase. The growth graph is flattening, and attracting talent is no longer an easy task. IT companies have found a way out of this muddle and are hiring interns as a cost-cutting measure, thereby giving them a temporary reprieve. But how far will this prove to be a respite needs to be seen. Will it open up new arenas for companies in terms of tapping the hidden talent or will it be a short-lived phenomenon based on a short-term vision?

Pressing concerns

The predicament which has bloomed out of a problem, is showing no signs of settling down, leading to revenue crunches and eating up the profit margins of companies. To combat this fuel, IT organizations are on the look out for interns who can serve their cause. In SafeNet India, hiring interns has been their long-term rolled out planned initiative that they have been undertaking for the last 10 years, in capacities and roles in departments like R&D, technical services and IT/IS functions. Every year, MouthShut.com hires a sizeable number of interns who are then trained to take over leadership roles in the near future. These interns are initially recruited for QA, software engineering, Web designing, IT and networking. Suvidhaa Infoserve hires interns for development jobs, application and business logic jobs, and they absorb 10-20 of them into the company.

Hiring interns in the short-term period saves the company substantial revenue in the form of salaries and the additional fringes that are attached to it. If they are hired for suitable roles that do not demand specialized skill-sets or expertise knowledge, then the company can put these interns through a crash course in process handling rather than months of exhaustive training programs chartered out for employees. So saving in training costs is yet another major attraction for companies to opt for this option.

Neha Aggarwal, Manager HR, Targus Technologies, said, “Hiring interns fills the gap of vacating workforce as they are flexible for certain job roles and convenience of hiring. But this measure has its own repercussions as well because chances of getting successful in any particular job role for these interns are very less in comparison to an experienced person. Stability factor is also a major issue with them as it is their first job and they are not matured enough to understand the responsibility and professionalism of any job.”

There is a mixed view on the benefits accrued by hiring employees who serve as interns. While some believe it is a useful way to ease out costs, there are others who feel that the cost of training them is high which adds up to the company’s burden.

Roy de Souza, Founder and CEO, ZEDO, echoed, “Interns get lower salaries, but I would not see them as a cost-cutting measure, because the cost of training them and supervising them is significant, unless you get your interns to do very simple things. The supervisory costs and the low level of meaningful work caused us to not hire interns regularly.”

Faisal I Farooqui, CEO, Mouthshut.com, felt otherwise, “Cost-cutting for the sake of reducing cost, has never been the sole objective of an employer. Yes, hiring interns does take the load off, but that is usually never the goal. We offer the most competitive salaries, but when attrition is in the air, turning to interns and then training them into thorough-bred professionals is far more viable. And going by our experience, if interns are trained well and are easily assimilated into the company’s culture, they become a real asset.”

Long-term returns?

There is a unanimous view that interns can be molded according to the job role and assimilated into the company.

They are also eager to learn and are enthusiastic about their work.

Also, if the right potential inside them is tapped and their skill-sets are exploited to the fullest, the company can gain long-term benefits in the form of a potential excellent performer.

Omprakash Deoli, Head HR and Operations, SafeNet India, said, “Most of the interns we hire are the ones who have to go through corporate training as per their curriculum. This helps students to do their corporate training, which is part of their course and on other hand helps us to identify interns whom we can hire at the entry level. As a policy we encourage hiring interns on a regular basis.”

Any company going in for hiring interns should achieve a balance between the short-term goals and the long-term mission, as also between new entrants and the old war horses. Also, cost-cutting merely for the sake of saving on a few bucks without appropriate vision can backfire and prove to be a costly calculation.

The challenge for employers is to create an ambience and a set up where these temporary fill-up positions can throw up spark amongst people and motivate them to put in their best; short-term strategy thus getting transformed into a larger beneficial scheme.

Farooqui said, “High attrition levels are here to stay for a while and till the time the market does not stabilize, organizations need to look for alternatives. Trainees bring with them a lot of enthusiasm and raw energy but zero experience. Focus should be on training them, keeping in mind the long-term goals of the organization. Short-term goals do not work. They only add to the cost of the companies.”

Weighing the impact

Business impact of hiring interns are both tangible and intangible, positive and negative too.

The positive aspects highlight that this mechanism helps create a pipeline of individuals who can represent the company in full-time roles at a later stage, if their performance is appreciable and their personality fits into the company’s culture.

The contentious issue remains that if interns are not serious about their work, then responsibility, integrity and professionalism remain the concern factors.

This is bound to affect the company’s attrition level, create delays, add up to costs and create an imbalance within the team. Hiring interns also helps permanent employees of the organization who are at lower levels to move up higher in the ranks, thereby enabling career progression.

renuka.vembu@expressindia.com