CAREER IN SERVICE SECTOR VS MANUFACTURING
SECTOR- THE CASE OF MBA ASPIRANTS
Introduction
naustnies
have traditionally ruled the economy across the world. The share of services in India's gross
0omesto
product (GDP) at factor cost (at curent prices)
increased from 33.3 per cent (1950-51) 0 00. per cent in
1 ,8 per advance estimates (AE).! The share of manufacturing in the GDP has hovered around 15-16 per
e radvance estimates made by the Central Statistics Office (CSO), the contribution of manufacturing to the
DOuring 2012-13 is 15.2 per cent at factor cost, at 2004-05 prices2 The National Manufacturing o y nVisages
that india's
manufacturing sector should increase its share of GDP from 15 ner cent at present to 25 per cent Dy z022,
global peers. RBI has also said that India needs to
aieve a
focuus more on manufacturing in oraer
GDP growth more than 6.5
per cent
in line
with
0
The
output in manufacturing sectors has
always shown positlve growth, though the workforce lacks the required
strength. YOung people bom during the 1980s and
piEer a
early 1990s, popularly referred to as Gen Y,
paricuiainy
career in the service sector over manufacturing. The question, thus, arises, why a country like India wiu a
growth-
polenual
manutacturing industry is unable to attract and retain young talent in this sector. Though most anuiduung
companies offer high compensation and incentive, the
younger workforae still
prefer the
sevoverallsegrowun o ne
manufacturing sector. Manufacturing industry has a lot of potential to contributemostly
significantly
in the
cOuntry. Therefore, attraction and retention of workforce, as well as analysis of shortfall of young talent in tnis sector
is
subject matter of concern and should be addressed at the earliest. The
productivity and Output in mandiacuing
industries continue to grow even as
manufacturing employment numbers drop in many countries." NO organizauon in
or
other
sector
manufacturing any
can compete in the global economy without a highly skilled and motivated workiorce
Global manufacturing
companies in most parts of the world faces a shortage of high-skilled workers and an aging
a
Workforce, resulting in a shortage of talent in these companies. Part of the answer to the growing probem may ie witn
Generation Y, which will constitute a significant proportion of the working-age population in the coming years. A failure
to effectively attract and engage these new workers will significantly hamper manufacturers' competitiveness in the
Iong run. Convincing this generation to pursue a career in the manufacturing sector, however, is a challenge in iself.
The problem is the negative image of the manufacturing sector, which is no longer seen as a leading source of
high-reward career opportunities. Other industries afford attractive alternatives for talented young people. To attract
these new workers, the manufacturing industry needs a model of talent management that will address the unique
characteristics of this generation.
Purpose of the Study
The diminishing incoming talent can pose a serlous threat to the long-term global competitiveness of manufacturing
firms. Therefore, it is important to attract young talent into this sector. This talent gap varies a great deal across
ufacturing industries and geographies in terms of magnitude, age, and skill type. The purposeofthis study is to
identify these elements which prevent the young talent, especiallythe managementgraduates, from joining this sector.
1 http://dipp.nic.in/English/questlons/27022013/rs46.pdf
2 htt:l/lrticles.economictimes.indiatimes.com/2013-03-17/news/37787192 1bag-report-people-productivity-competiveness
3 Hitpy/laricles.economictimes.indiatimes.com/2012-08-05/news/33049112_1gdp-growth-pension-and-insurance-funds-gover-
nior-d-subbarao
4 nttp://www.deloitte.com/assets/Dcom-GlobalLocal%20Assets/Documents/dtt_dr_talentcrisis070307 pdf
5
htp/www.deloite.com/assets/Dcom-GlobalLocal%20Assets/Doquments/dit_dr_talentcrisis070307 pdf
Methodology
The reseBrch design employed in the present study is expforatory. A focus group discussion (FGO) is conducted, in
which the participants are eight students pursuing MBA in Human Resource Management in a business schoolin
pelhi. Responses during the FGD are recorded using audiotape and later transcribed in their entirety (transcription of
FGD is presented in Appendix)
Appendi
Transoript of the Focus Group Discussion
Moderator: Hi, good afternoon people. First of al, thanks a lot for participating in the FGD process The issue on
which we are going to have a discussion is Preference of management graduates: manufacturing sector or the
service sector? To begin with, I would like all of you to introduce yourselves. The format of the introduction would be
vour name. your summer internship company, wherever applicable, and your dream compan)y where you would like
to
work in future
Preetesh: Iam Preetesh and my summer internship company is Philips. I wish to work fora companylike Mercer or
EnY
Shishank: 1 am Shishank, my internship company is Pylon Consuting and my dream company is Best Buy.
Bhavna: I am Bhavna, my internship company is Deioitte and my dream company is Cadbury
Simar: 1 am Simardeep
Singh,
my
internship
company is
Capgemini,
Isha:Iam Isha. my internship company is Asian Paints, and I do not
it.
like to have the experience of everything, have not thought about
and I want to work in Walmart.
actually
have
a
dream company,
I would
rather
Bani: 1am Bani Updhyay, I don't know about my internship company yet, my dream company would be in the banking
sector
Khushboo: I am Khushboo, Iam not yet placed and about dream company, today the market is so bad. there is job
crunch everywhere, so if I get a job either in manufacturing or service sector, I would take it.
Jalpan: Hi, I am Jalpan. Summer Internship Company is Hero MotoCorp and Dream Company is Google.
Moderator: Thanks a lot. To begin with the FGD our first question to the group is, what do you think is the key fact
that an MBA graduate looks for in a job? You can take a minute to think about it and please come up with two to three
factors
Simar: 1 think, compensation
Bhavna: 1 think rather than compensation, Gen Y would be looking more towards work-life baiance. It has become
thefocus of every individual now
Khushboo: At any point of time, salary would definitely be a major deciding factor for your job but it would aliso
depend on your interest like you all said It you are heading towards your dream company, even if it offers a somewhat
less compensation you would definitely go for it.
Jalpan: Major factor would be the applicatiorn of what you have learnt Many people coming for MBA feel that they
have learnt something in engineering but are not being abie to apply it So it is the identity of a job, and the fact that
you will be able to apply what you have learnt, is a critical factor A young professional looks for these factors after
postgraduaton, primarily because after
thus, he may not
study any
further
Isha: For a pérson ike me, who is a fresher and does not have a dream company, the determining factor would be
the job opportunities that I get, whether it is a compeling sector, how it suts my needs, at what point of career I am
and tow t will further enhance my Ca/tter
Moderator: So, suppose you are sitting for campub placement, what is the determining factor for you?
162
Research Methodology
or framework, the brand
when you do not have prejudices against a company or a set mind
Initially,
matters. So, when Asian Paints had come, my aim was to crack it or RPG, which were the initlal ones. Furthe
ther
isha:
realy
down
he line, ofher factors come in and then it is not the brand. Even if it is a small start-up, if it is giving me dgood package
and
good opportunitly to grow as a
person and
good job profile
Preetesh: Apartfrom the brand look forward to a company which gives me recogniton.
Moderator: You mean the job
profle?
Freeresh: Not only that, but also the type of work I do. I should be in a company or department wnere i should fee
mportant. Ontly when you join, you get to know of these things, like I have worked before, andtnere are situations
drops
work day and night for a particular
project and you don't get recognition. Then your
where you
at
ine
tnen
DUt
same
and you tend to stop giving your best for that
job. Brand and compensation are Important,
downs
time, recognition is important.
salstaconov
Vedant: So you are talking about non-monetary rewards?
Preetesh: It can be tangible, intangible both.
Bani: As
a fresher the
factor would be the growth
as do not
ke to take up a job which offers me lot of opportunities and as I ao down the line the work Culture and tne kind of
determining
opportunities
nave
environment that it offers to its employees would be the major determining factors.
Simar:
In Our college, companies like 1CICI that offered a package of 9.5 lakh per annum, there is no quesion of
manufacturing or service sector in that case, because each and every student had applied for the lCICi because of
the package. I am just emphasizing that compensation is one of the major factors for people while selecting their
companies in colleges like ours.
Simar: think compensation is one of the majorfactors that play an important role in people selecting sectors in an
MBA college like ours.
Moderator: Companies belonging to these wo sectors-do they have a preference regarding which institutes
they want to go to? Are you saying, service sector industries are more interested in 2nd leveil B-schools than the
manufactuingindustry?
Simar: As our economy is a servioe-oriented economy right now and around 80-90 per cent of the companies are
service oriented, so manufacturing is like a subdued kind of sector. So few people are willing to go into manufacturing
sectors, as there are not enough jobs.
Bhavna: Moreover, the jobs in manufacturing sectors are much more challenging than in the service sector. There is
no work-life balance in the manufacturing sector, especially in Industrial Relations role. That is a challenge that I think
Gen Y will not be wiling to accept.
Jalpan: Rightly said, manufacturing sector is subdued and plays a smal role in the economy. so companies that have
vacancies prefer going to top colleges and then coming to tier 2 colleges.
Simar: I think that is the reason people prefer service-oriented industry, because they do not have exposure to the
manufacturing sector.
Jalpan:
There is
no
opportunity avallable in manufacturing sector.
lsha: Manufacturing companies are located out of metro areas. Metros are a big atraction for every other gen Y. They
want 1o stay in metro areas, whereas marnufacturing companles are In the areas like Surat and Ankleshwar, which are
not attractive citiles for Gen Y.
Preetesh: But i still believe that the people working in the manufacturing sector tend to save more because the cost
of living is low in these locations
as
compared to melros.
Simar: It is changingfast. Now, people of Gen Y tend to spend more.
Preetesh: Th»t is why they demand much better compensalion.
Simar: That is why people are wiling to spend their money and so they prefer metropolitan cities rather than any other
'1
t i t ril
CQneElon
Isha: Then your work-life
balance comes
spend as you
have earned
it.
There
are
into
also, nobody talks what kind
of exiting
you are getting a big brand
Even if it's
5, then you
are
a
You like to
spending opportunities
Khushboo: Whatever may be the sector, our
Preetesh:
picture.
spend your hard earned
money when you like
to
generation is very brand-conscious. We
want big names. In our
projects you got but which company
summers
you got into. So if in
they may change their preferences;
change their work life balance manufacturing sector
preference and anything.
manufacturing company and offers you better
and
staying less in the office rather than a service job, timing work-life balance, say timings of 10where you have to
stay the entire day.
Simar: There is a perception that
in
an
office gives you a better
sitting
play a very important role.
reputation. A person's perception and
psyche
While
Jalpan:
talking of MBA graduates, a lot of us are not aware of the
are
nitty-gritties of the role we will play. Many
decided on the basis of
things
apparent values like brand, societal value, brand
will respond to it. These factors are not
compensation and how the family
related to the job we will do.
Preetesh:
We do not have any hands-on
experience. Whatever we know, we know it through people who
have been
there and from market surveys. So
maybe, joining a manufacturing firm may turn out to be a
good experience.
Bani: Ithink it is all about consistency. You
take
a
might
up
job because of brand but how long will you
be able to work there?
manufacturing
Simar: 1think there
three external environmental
pressures. Economic pressures, the social factors, and the kind
of environment you were born and
brought up in. Say, if you are brought up in Delhi, then you may join the service
sector rather than manufacturing. If you have seen the
manufacturing sector or have been in its vicinity, then it has a
are
very big impact on the person.
Moderator: We have leant in
major leverage.
Is that
our course
that if we have
an
Industrial Relations
important factor or we just move forward?
Simar: IR sector leverages our knowledge.
an
profile to begin with, it gives
us a
Moderator: We have studied in our course that if we
have an IR profile to begin with, it leverages our career growth.
So will an MBA graduate pursuing his course consider it as an important factor?
Bhavna: Yes, it is because starting with an IR role, it is easy to shift from an IR
role to other roles of HR. But for one
of
which
is
HR,
not
an
IR
position
role, but perhaps in service sector it is very difficult for that person to come back
in manufacturing and handle the role of an IR. I believe that starting from an IR
role, gaining experience there and
progressing the career pattern is much better option.
Khushboo:
I think it
depends on your personality type. If you are not suitable for the
manufacturing sector, then why
go for it; you will rather pick up service industry. Ideally, it depends on
our personality but if we don't have any option,
then we judge our personality then we select a sector then a company. But today, since we do not have an option
to
judge our personality and then select a
where we are placed.
sector, then
we
select a company. So anyway,
we
have to get in any company
Moderator: Somebody said that jobs in manufacturing sectors are more challenging, whereas the service sector
maintains more work-life balance in a person's life. Let us suppose a person is really career oriented and he wants to
go up the career ladder. In that case, what do you think his decislon would be?
sha: For me, it would be manufacturing. If | am focused on my career I'l first go for manufacturing sector, probably
later in life when I settle down, I have a farmily, so thenI will see what kind of balance I will have. Then I may shit to
service sector.
Moderator: So is it right to say that manufacturing sector is a stepplng stone to a rise in career?
lsha: Yes
Moderator: Another question I would like to ask the group is, as Simar mentioned that India is now a service industry,
80 do you think the manufacturing sector in India has the potential to grow? There are many jobs in the manufacturing
Industry but MBA graduates are not wiling to take these up for various reasons, which you guys have already clted.
thing
that we need to
have is manpower. As being
a
power centre rignt
other resources but manpower is the most important resource.
think
manufacturing-sector-oriented economy as well but that may take some
echnology and all
now.
capability
to
the
ecome a very
to
be
:
have
a
gradual
process
time. It will
we have the
Shifting from service to manufacturing, people do not have the perception
ented industy
Moderator: What do you think will make an MBA graduate shift his or her perception from a service oriented
to
a
manufacturing industry?
Shishank:
think, ifwe really want to move up the ladder, if we really want to become vice-president,
need to have exposure in all the fields of
It is better to
nave an
an
have
HR, then we
IR exposure
expoSUre
HR, from IR to recruitment to compensation.
has high aspirations he should start
at the beginning of
your career rather than having at the very end. So l a pei
ns
prOme because after some time it becomes verv difficult to move from service to manuiacturing
sector.
O r a l o r : Do you think women wll not prefer a manufacturing sector job and would go ror a sErvice sector job?
All: Yes
Moderator: Why?
Bhavna: Because the role is much more challenging in the manufacturing secto.
Simar: Not that. Many employers do not want women at the factory site. There are many 15Sues iKe la0our isues
related to them.
Shishank: Also, the glass ceiling is more significant in manufacturing than in service.
Khushboo: All the manufacturing plants are located in such remote locations so it will be ificult for women afer
marriage.
lsha: I think that is the driving factor in the diferentiation. Similarly, when you start your career, being a gin, l would
prefer the manufacturing sector because when I setle down in life later on, I cannot be in a manufacturing sector and
I have to shift to the service sector.
Bhavna: I think the pressure of an IR person is much more demanding and challenging and I feel that women cannot
give that much of time and dedication to the job.
Khushboo: I do not think dedication is a problem.
Bhavna: Because later on in life when you have a family to go back to, you would not prefer to stay in the office post
8 pm.
Simar: Even in the service sector you have to stay post 8 pm but nowadays these
things are being taken care of.
the manufacturing firm is providing. For
Jalpan: It also depends on what kind of firm and what kind of facilities
in these
example, the Reliance Jamnagar Refinery has the best township in the world and even women prefer to work
kinds ofsites
Khushboo: Even in service industry, you are required to work 9 to 9 so even that kind of work is demanding and much
more challenging than the work in the mahufacturing secto. So, a lot depends on the firm.
Preetesh: So, for a manufacturing firm it is more important to provide basic amenities that one gets in a metro,
a
people prefer metros for their facilities. For a manufacturing firm located in a remote area they should have
are
township. Also, there is a bias among us that manufacturing fims have people who are moreexperienced. There
fims. So, for a manufacturing fim to flourish, they should have people from
very few freshers who join manufacturing
because
similar age group. They should have some criteria on the basis of which they should select a certain number of people
from certain colleges who are fresher.
the
Moderator: Don't you think, if you join at a junior level and you know that there are people at the senior level in
from them?
manufacturing firms, you will have a better learning opportunity
have the criteria that people from the younger generation are taken in for better salaries and
Preetesh:
o0Dortunities so that we do not get scared that there are senior people in the company and we cannot adjust with them.
They should
Qualitative Methods of Data
Moderator:
Do
you think the
work culture plays a role in
selecting
a
company?
and adaptable. Relating to Gen Y,
Yes. In the service sector it is more flexible
and refineries have a set
whereas in the manufacturing sector, the plants
Bani:
frequently,
Collection165
more
things can be changed
pattern of work, so it is very
dificult to bring about a change in their culture.
Moderator:
What
can
the manufacturing
sector do to attract Gen Y?
certain minimum amenities for
people
There should be
important role should be of the government.
maintain in
Simar:
that the manufacturing sector should
sector. There should be fixed policies
the
manufacturing
cominginto
order to sustain interest in this sector
there should be provision for mandatory
count goes beyond a certain number
if
employee
Jalpan: Additionally,
cities that are not used for agriculture
area. For example, the land near
near that manufacturing
amenities
townshipand
and Orissa are good examples of this.
crowd.
The most
Gurgaon
the
young
should begiven to industries to attract
time and response.
Moderator: Thank you so much for your
QUESTIONS
1,
recommend should
in the transcripts using content analysis. What do you
categories
the
underlying
ldentify
Content Analysis)
be the unit for Content Analysis? (Refer chapter 6 for Unit of
2. What are the major factors responsible for career inclination among MBA graduates?
of students towards manufacturing
the
reasons behind the non-preference and preference
3Whatare
major
sector?
4, Comment on the information sought through FGD in the light of objectives of study.
Answers to Objective Type Questions
1. True
6. True
2. True
3. False
7. False
8. True
4. False
5. True
10. True
11 False
12. True
13. False
5. False
14. False
16. False
17. False
18. True
19 True
REFERENCES
15. True
20. False