IT industry slows, Indian companies ready for large layoffs

[BaabuBangaram]

BENGALURU/CHENNAI: Large IT services companies are all in the process of laying off employees on a scale not seen since the 2008-10 downturn. Those taking the hit first are mid and senior level professionals, those with 10 to 20 years of experience, but the expectation is that lower level employees too will be hurt later in the year, as growth in the $150-billion industry slows far more than anticipated and companies move towards hiring more in the US. The situation is worsening to a point where affected employees are beginning to approach labour unions to take up their cause.

Cognizant last week announced a voluntary separation programme for directors, associate VPs and senior VPs. Some 1,000 executives are expected to go. The company, one of the top performers in the industry, is expected to eventually cut at least 6,000 jobs+ , or 2.3% of its total workforce. Last Thursday, ten Cognizant employees, through the Forum for IT Employees, filed a petition with the assistant commissioner of labour arguing that they were being forced to sign voluntary resignation letters.

At Infosys, nearly 1,000 employees in job level 6 and above (group project managers, project managers, senior architects and higher levels) are expected to be asked to leave. Managers at these levels have been asked to identify, in terms of performance, the bottom 10% of their reportees.

Three weeks ago, Wipro + CEO Abid Ali Neemuchwala mentioned in an internal conference call that if revenues don't grow, around 10% of employees would be let go off this year. The product engineering team is likely to be one of the big casualties. Wipro ended the last fiscal year with 1.81 lakh employees.

Responding to TOI's question after the earnings, Neemuchwala said, "It's across service lines...performance appraisal is nothing new. I don't know which conference call you're talking about, but I have a conference call with my leadership team every month and I go through a lot of items. There are to-dos in every quarter. We have done away with the bell curve. Today, the performance measurement is not on what you were doing till yesterday, but whether you are ready for tomorrow."

French IT services major Capgemini is said to be letting go off nearly 9,000 people, or nearly 5% of its workforce. A large part of this are erstwhile employees of Igate, the company that Capgemini acquired in 2015. Capgemini had asked over 35 VP, SVPs, directors and senior directors to leave in February and 200 people were asked to leave at one of its offices in Mumbai.

As of March 31, Capgemini's total headcount was 195,800; 57%, or 111,300 employees, are in offshore centres, mostly in India.

Asked about the layoffs, Capgemini did not deny that some had been asked to leave, but said it expects to recruit over 20,000 new team members in India this year. "Each year our employees are evaluated based on strict performance criteria in an objective process, consistent with industry norms, to ensure we are aligned with our customer needs, business priorities, and the overall industry evolution. This leads naturally to a varying number of employees transitioning out of the organisation in any given year. We continue to accelerate our training programmes in 2017 with over 2,000 India employees having already undertaken upskilling and emerging technologies training alone," it said.

Infosys said its performance management process provides for a bi-annual assessment of performance. "A continued low feedback on performance could lead to certain performance actions, including separation of an individual and this is done only after feedback. We do this every year and the numbers could vary every performance cycle," the company said in a statement.

The slowdown in IT services is now palpable. Cognizant, which was growing at about 20%, expects to grow this year at only 8-10%. Infosys, which grew at 13.3% in constant currency in 2015-16, was down to 8.3% in the last fiscal and expects to grow only between 6.5% and 8.5% this year. TCS, which was growing in the teens, did just 8.3% last year.

Peter Bendor Samuel, CEO of IT consulting firm Everest Group, said the industry growth has slowed and the "arbitrage first" segment (traditional IT services) is in secular decline. "When this is added to the pyramid factory model which requires new freshers to be brought in every year to keep cost low, it results in an excess of more experienced employees," he said.

 

 

[BaabuBangaram]

MNC lo pani chese allu mi experience cheppandi

[Novak_Djokovic]

Sad to hear that Indian MNC is having problems...with these h1b rules in US...

They are many middle class IT employees in India...who will have impact of this...

[princeofheaven]

7 minutes ago, BaabuBangaram said:

BENGALURU/CHENNAI: Large IT services companies are all in the process of laying off employees on a scale not seen since the 2008-10 downturn. Those taking the hit first are mid and senior level professionals, those with 10 to 20 years of experience, but the expectation is that lower level employees too will be hurt later in the year, as growth in the $150-billion industry slows far more than anticipated and companies move towards hiring more in the US. The situation is worsening to a point where affected employees are beginning to approach labour unions to take up their cause.

Cognizant last week announced a voluntary separation programme for directors, associate VPs and senior VPs. Some 1,000 executives are expected to go. The company, one of the top performers in the industry, is expected to eventually cut at least 6,000 jobs+ , or 2.3% of its total workforce. Last Thursday, ten Cognizant employees, through the Forum for IT Employees, filed a petition with the assistant commissioner of labour arguing that they were being forced to sign voluntary resignation letters.

At Infosys, nearly 1,000 employees in job level 6 and above (group project managers, project managers, senior architects and higher levels) are expected to be asked to leave. Managers at these levels have been asked to identify, in terms of performance, the bottom 10% of their reportees.

Three weeks ago, Wipro + CEO Abid Ali Neemuchwala mentioned in an internal conference call that if revenues don't grow, around 10% of employees would be let go off this year. The product engineering team is likely to be one of the big casualties. Wipro ended the last fiscal year with 1.81 lakh employees.

Responding to TOI's question after the earnings, Neemuchwala said, "It's across service lines...performance appraisal is nothing new. I don't know which conference call you're talking about, but I have a conference call with my leadership team every month and I go through a lot of items. There are to-dos in every quarter. We have done away with the bell curve. Today, the performance measurement is not on what you were doing till yesterday, but whether you are ready for tomorrow."

French IT services major Capgemini is said to be letting go off nearly 9,000 people, or nearly 5% of its workforce. A large part of this are erstwhile employees of Igate, the company that Capgemini acquired in 2015. Capgemini had asked over 35 VP, SVPs, directors and senior directors to leave in February and 200 people were asked to leave at one of its offices in Mumbai.

As of March 31, Capgemini's total headcount was 195,800; 57%, or 111,300 employees, are in offshore centres, mostly in India.

Asked about the layoffs, Capgemini did not deny that some had been asked to leave, but said it expects to recruit over 20,000 new team members in India this year. "Each year our employees are evaluated based on strict performance criteria in an objective process, consistent with industry norms, to ensure we are aligned with our customer needs, business priorities, and the overall industry evolution. This leads naturally to a varying number of employees transitioning out of the organisation in any given year. We continue to accelerate our training programmes in 2017 with over 2,000 India employees having already undertaken upskilling and emerging technologies training alone," it said.

Infosys said its performance management process provides for a bi-annual assessment of performance. "A continued low feedback on performance could lead to certain performance actions, including separation of an individual and this is done only after feedback. We do this every year and the numbers could vary every performance cycle," the company said in a statement.

The slowdown in IT services is now palpable. Cognizant, which was growing at about 20%, expects to grow this year at only 8-10%. Infosys, which grew at 13.3% in constant currency in 2015-16, was down to 8.3% in the last fiscal and expects to grow only between 6.5% and 8.5% this year. TCS, which was growing in the teens, did just 8.3% last year.

Peter Bendor Samuel, CEO of IT consulting firm Everest Group, said the industry growth has slowed and the "arbitrage first" segment (traditional IT services) is in secular decline. "When this is added to the pyramid factory model which requires new freshers to be brought in every year to keep cost low, it results in an excess of more experienced employees," he said.

 

 

Assamed

[greensboro]

Automation effect. 

future lo automatic code raase technology vasthundi. java, .net based people antha ready ga undandi

https://qz.com/920468/artificial-intelligence-created-by-microsoft-and-university-of-cambridge-is-learning-to-write-code-by-itself-not-steal-it/

[Novak_Djokovic]

19 minutes ago, greensboro said:

Automation effect. 

future lo automatic code raase technology vasthundi. java, .net based people antha ready ga undandi

https://qz.com/920468/artificial-intelligence-created-by-microsoft-and-university-of-cambridge-is-learning-to-write-code-by-itself-not-steal-it/

Sql and oracle programmers also....

[JANASENA]

[Jambhalheart]

26 minutes ago, greensboro said:

Automation effect. 

future lo automatic code raase technology vasthundi. java, .net based people antha ready ga undandi

https://qz.com/920468/artificial-intelligence-created-by-microsoft-and-university-of-cambridge-is-learning-to-write-code-by-itself-not-steal-it/

not really..  real world objects or real world business logic is too complex to handle bro... already there r many existing tools for development in .Net & Java in the market

For ex: .Net already has tools like  sharepoint, sitecore, kentico where web application can be built in few hours than traditional coding. But not always it can help to customize in writing in client specific complex business logic required..  but it can help in reducing the lines of code..

same with above stuff, it can reduce the lines of code but still need humans to code... 

[kiraak_poradu]

ready already doing lay offs infy tcs cts mainly

[greensboro]

1 minute ago, Jambhalheart said:

not really..  real world objects or real world business logic is too complicated bro... already there r many existing tools for development in .Net & Java.

For ex: .Net already has sharepoint where web application can be built in few hours than traditional coding. But not always it can help to customize in writing in client specific business logic required..  but it can help in reducing the lines of code..

same with above stuff, it can reduce the lines of code but still need humans to code...

agreed bro kani oka AI machine ki manam chese coding lo training isthe future lo adi chese chances unnayi.

ippudu for example insurance company business lo domain knowledge lo training ippisthe AI machine can do wonders.

domain knowledge important bro. prathi company(auto insurance,health insurance, manufacturing, banking, pharma) veetillo business domain knowledge same untundi kani vella business conditions maarochu. vaatiki training avasaram. AI machines ki training ippisthe cheyyochu future lo

[Prabhas_Fan]

Kottadi emina cheppu daling

[Bhai]

1 minute ago, Prabhas_Fan said:

Kottadi emina cheppu daling

 

47 minutes ago, BaabuBangaram said:

MNC lo pani chese allu mi experience cheppandi

 

[Jambhalheart]

1 hour ago, greensboro said:

agreed bro kani oka AI machine ki manam chese coding lo training isthe future lo adi chese chances unnayi.

ippudu for example insurance company business lo domain knowledge lo training ippisthe AI machine can do wonders.

domain knowledge important bro. prathi company(auto insurance,health insurance, manufacturing, banking, pharma) veetillo business domain knowledge same untundi kani vella business conditions maarochu. vaatiki training avasaram. AI machines ki training ippisthe cheyyochu future lo

somewhat true but I doubt if it completely replaces human.

for example : recent ga 5 years back angular JS vachindhi..  andhaaru angular JS nerchukoni code cheyadam start chesaaru.. John papa ani okadu 'Hot towel' (https://github.com/johnpapa/HotTowel-Angular)  ani tool thechaadu 2014 lo..  ee tool ki inbuilt angular templates vuntaayi , angular lo code peddaga rayanavasaram ledhu.. ani annadu, kaani real world scenarios ki aa tool konthamandhike use avthondhi.. still people r learning angular JS & writing all the dirty code instead of using tools.. 

elanti tools eppati nunchi vunnayi vasthuney vuntaayii kaani entha use avthundhi anedhi cheppadam kastam... wat I am trying to say is... this is not something new of replacing humans with some automated tools...

 

 

[BaabuBangaram]

1 hour ago, Prabhas_Fan said:

Kottadi emina cheppu daling

Nenu MNC lo work cheyyatle so naaku theliyadhu

[Prabhas_Fan]

38 minutes ago, BaabuBangaram said:

Nenu MNC lo work cheyyatle so naaku theliyadhu

mari dentlo working nuvvu