Recruitment challenges in building a tech consultancy in India


With the digital ecosystem in a boom, IT Services and IT Consultancies are in demand. To start a tech consultancy, you don’t need huge capital investment. However, you need dedicated people. The starting point of a tech consultancy is to hire the right people who take ownership of projects. It is why tech consultancies credit their motivated and enthusiastic employees for their success. 

However, hiring tech people is challenging. You will be held up with meeting the client’s expectations and tight deadlines. Moreover, new tech consultancies are short on both time and money. Hence, the recruiting process, from sourcing candidates to evaluating them and hiring, becomes a tedious task.

We have identified challenges in building a tech consultancy in India and best practices to overcome them.

1. Talent shortage

A shift from a 9-5 workday and competitive workplace to a flexible, remote and culture-oriented modern workplace is significantly impacting tech hiring. As talented candidates choose freelancing and project-based collaboration, it significantly widens the talent shortage for new tech consultancies with weak employer branding to attract enough talent.  

How to overcome

To overcome talent shortage, companies are considering bypassing academic requirements and focusing on skill-based hiring. Another great way to address the issue is to develop in-house training to upskill the existing workforce. Companies also provide upskilling opportunities to their non-technical workforce for technical positions.

2. Rising competition

A-candidate-with-multiple-job-offer due-to-rising-competition
A candidate with multiple job offer due to rising competition

Unlike many other businesses, starting a tech consultancy has fewer barriers. As more businesses enter the industry, finding talented people becomes difficult. In recent years, new tech consultancies have come up. As all of them work hard to hire the best tech candidates, it becomes painstaking for a small tech company to hire the best candidates consistently.  

How to overcome

Focus on creating a compelling employee value proposition – offering industry standard salary and benefits. Take steps to build the company’s reputation as an employer that people want to work for.

3. Unreliable Candidates

Unreliable candidates

Another unfortunate challenge in hiring talented tech candidates is the uncertainty of whether or not they will join you. Those with multiple offers may join another company, and some may use your offer letter to find another lucrative offer. 

How to overcome

You cannot directly prevent such a scenario. And as a new tech startup, you will continually drain resources in sourcing candidates and the recruitment process. You can minimise last-minute drop-off by engaging the candidates, offering them signing bonuses and buying out their notice period for immediate joining.

4. High salaries

In recent times, the salaries of tech candidates have hit record highs. The average salary increase in India’s high-tech sector was 8% in 2021, rising by 1.9% to 9.9 (The Economic Times) in 2022. Still, a huge proportion of the tech workforce is dissatisfied. 

When joining a new company, candidates have high expectations for salaries. In its early stage, it is not feasible for tech consultancies to pay as developer demands. 

How to overcome

Negotiate well to break down the candidate’s expectations and arrive at a realistic number. If required, tweak your offer for compensation and benefits. Offer equity options, joining bonus, etc.

5. Lacking skills to evaluate technical candidates

Recruiters in a growing tech consultancy lack proficiency in evaluating tech candidates during screening. On top of that, the limited bandwidth of the internal tech team in evaluating candidates’ technical skills leads to poor hiring. Moreover, tech consultancies are short on time. The tech team is busy with projects and meeting deadlines and hence cannot devote much of their time actively participating in the recruitment process. 

How to overcome

Ask your engineering team to invest time in the hiring process. Give them the required training to learn the art of interviewing.

6. Low retention

The increasing needs require new age skills. Talented tech workforce who constantly upskill and learn new technology get multiple offers. Often, new tech consultancies find it difficult to make counter offers. Employees leave jobs in a short time for higher pay. As the team size decreases, startup tech companies fail to finish scheduled projects.  

How to overcome

Don’t just hire to fill vacancies. Look for motivated and enthusiastic individuals who believe in your mission and vision. Develop a great company culture and offer work-life balance. It will significantly boost your employee retention rate.

In addition to the above solutions, consider using an applicant tracking system like PyjamaHR to address challenges effectively. It helps companies overcome recruitment challenges by automating repetitive tasks. You will have a streamlined recruitment process and reduce the time and money spent manually. It is an ideal recruitment software for busy recruiters, short on time and money.

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