India may witness a shortfall of half-a-million people in the business process outsourcing industry by 2008, according to a McKinsey estimate.

This will force IT companies in India to ensure that recruitment processes are aligned with retention strategies.

PricewaterhouseCoopers partner Joydeep Dutta Gupta explains that the effectiveness of any IT company depends on the quality of inputs, which is new employees.

Accordingly some companies have been making a paradigm shift in their hiring process by focusing on competency frameworks and other selection instruments.

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In some cases, explains Dutta Gupta, companies take an active interest in the recruitment process, clearly identifying profiles and positions.

This is especially true for build operate transfer models, wherein the client is preparing to take over all assets - human and physical after a pre-defined period.

In addition, an interesting strategy being adopted by a few respondents includes recruiting employees belonging to an older age bracket, for want of a higher degree of employee stability and commitment.

PwC in its latest report had also mentioned that companies in order to tackle the HR had begun attempting to reposition the BPO industry as an attractive long-term career option, thus far considered a 'stopgap' solution to fresh graduates - the target employee segment.

A majority of the respondents to this survey took proactive measures such as detailing career growth plans for employees and communicating the intent to potential candidates through campus road shows and employment fairs.

TWS president, CEO and member of the board, Rakesh K Kaul, explains that talent management is centered around two parts -- domain expertise and the other at the agent level.

He added that in the areas of domain expertise, TWS imports talent from abroad into the country for 12 months or 18 months, that is, bring in professionals from there to the Indian centre. While at the agent level, the company constantly upgrades the talent.

This is more so at the inception of a new project wherein the core team from India is taken to North America where they can absorb all of the knowledge and then brought back.

The executives were speaking at the Global Offshore Outsourcing Summit 2005 organised by the Indo-American Chambers of Commerce on Wednesday.

Ernst & Young associate vice-president Samir Bangara and Infosys' [Get Quote] BPO arm Progeon Progeon managing director and chief executive officer Akshaya Bhargava agreed that this could become a crisis situation at the mid-management level.

Bhargava said, "Which is why there is constant appraisal system in our company. BPO industry is like a Formula One car. If one does not know how to drive it, one will just crash and die. It has to be maneuvered well and it has to have all the support functions in place. In the BPO industry the support functions include strong internal processes, HR, finance performance appraisals and career development to name a few."

He indicated that while he spends 40 per cent of his time with his clients, 30 per cent of his time is focused on HR and related issues. Kaul along with the other players have emphasised the importance of a public-private partnership, which if it comes to come into play will prove to be successful.

Progeon for instance initiated Project Genesis wherein it had brought 124 teachers from 51 colleges in Karnataka to its campus in Mysore, where the teachers were exposed to the workings of a BPO.

Bhargava explains that the teachers were so excited that they plan on developing a common curriculum focused on BPO to teach at colleges.