Tough outsourced supplier questions #2 – Amit Somaiya interview with Steve – Part 4
Amit Somaiya is co-founder and CEO of IMS People, a part of the highly regarded Empresaria Group plc UK. Amit discusses the Do’s and Don’ts of outsourcing, what it’s like to build up businesses including dealing with failure, and personal attitudes and philosophies that got him where he is today.
This fourth part asks: 1. What do you fear most – Trump or automation? 2. Do you still see outsourcing as a growth industry? 3. Have you looked at outsourcing your services to other countries? Part 5 will focus on recruitment markets and talent pooling.
Steve: What do you fear most? Trump or automation?
Steve: Are you not worried about the Trump effect, localization of labour in the US? Because the US is a significant market for IMS.
Amit: It is, close to 60% of our business comes from the US market, it is scary what has been happening in the last few weeks now. The world is so tightly connected and everybody is pushing for a free market economy – but it is scary at this point in time, because whatever political agenda there is for the US government, they can be restrictive or create hurdles for us. But for the medium and the long term, I think the horizon is very positive. We will have some hiccups like in an aircraft, we’ll come across an air bump, so you just have to fasten your seatbelt and stay focused… and eventually, you’ll have a happy journey.
Steve: And I guess in politics you have a lot of hot air. Let’s see what actually materializes.
Amit: I’m flying to the US in two weeks from now so its going to be interesting when I’m over there and meet some of our clients and prospective recruitment companies at the executive forums. It wwill be interesting to hear from them what they think.
Steve: And what about automation? Everyone’s talking about AI at the moment – artificial intelligence will take over the world, we no longer need humans to do anything when it comes to recruitment. What’s your view?
Amit: When you asked the question “What I fear most” – I said automation – because the Trump effect is reversible and it is momentarily. It’s a four year term, it’s short term. But automation, I definitely fear that because that is a real disruptor to any business economy. Automation will disrupt our industry. When we had the advent of the job boards, everybody said that job boards are going to be disruptive and recruitment agencies will close down. But recruitment agencies did not close down.
However automation could be a different story. The reason I fear it is because its very unknown. You don’t know how its going to disrupt… You need to be intuitive to understand what vacuum its going to create out in the market.
Steve: Are you not interested in developing automation technology? Will that not be part of your strategy of creating the tech while you have the cost advantage?
Amit: Creating the tech is always something which is very glamorous. But development of technology, there are two parts of it, one is the ideation of it, and the other is the hardcore development. We are not a software development company. We do not have the hardcore elements of it. But the ideation and the creation of it is something that can actually be learnt through experience and the knowledge which we have from outsourcing. So we have some sense of what can come out of this disruption. But we haven’t as yet named that idea. We are very keen to support this disruption by bringing some technology but right now the idea is very weak. Its still a people business. Time will tell. We really want to do something, but the ideation of it is still hazy at the moment.
Steve: So you see outsourcing as a growth industry?
Amit: It’s a growth industry with excellent prospects for at least the next 10 years – because there are so many recruitment and staffing firms. They will continue to use outsourced service solutions.
But the form of outsourcing is shifting all the time, as technology automates some of those services – job posting for example, was one of the services which we first provided – now superseded by technology. You’ve got various products in the market, some high end technology, some fascinating technology like idibu. You don’t really need an outsourced agency to do it. But if you want to do a 360 degrees sale, you want somebody to be talking to the doctors or aircraft pilots, or engineers or IT contractors, trying to negotiate salaries with them – taking outsource services to the next level – we do that now, we’re inside the sales function.
Steve: Have you looked at outsourcing you services to other countries?
Amit: Yes! We have been evaluating locations such as South America, the Philippines as well – the answer is yes but we haven’t finalized which countries which we would go to.