TCS, Wipro, Infosys, loosen purse strings to retain staff

BANGALORE: Nitin M, a techie in his 30s in IT capital Bangalore, still feels a chill run down his spine as he recalls the roller coaster ride his professional life took during the economic slowdown last year. In the pre-slowdown days, he belonged to the country’s most pampered workforce, when jobs were easy to come by and perks were splashed. The storm came soon enough. The smiles thinned out, and the number of colleagues he shared his expansive office space with too began to diminish. Sodexo coupons were cut, easy rides in private taxi cabs were replaced with journeys in crowded company buses. And salary hikes were a thing of the past. As a new decade unfolds, the wheel has come full circle. Nitin, who has recently landed a job with another IT company, said his previous employers had slashed increments during the recession. “Now, the company is giving a 40% hike to hire former employees back.”

Salary hikes in the offing IT employees and HR experts expect many companies such as Target, Cognizant, SAP, VMware, Mahindra Satyam, TCS, Wipro, Infosys, Genpact, Oracle, MindTree and Accenture to offer a pay hike of 7-15% at the operational level and 12-18% at senior levels. Abhinav Krishnan, an employee at VMware, the largest maker of software that lets computers run different operating systems, recently received a salary hike. This came as a big relief to him as he is his family’s sole breadwinner. “The company I worked with previously did not give me any hike. So I moved out, and my salary has now doubled,” says this 26-year-old employee, who was earlier with one of the world’s largest technology companies. Similarly smiles are back on the face of the 27-year-old techie working at advisory services firm Ernst & Young. He had planned to buy a car and a bigger house last year, but these dreams wilted away in the economic slowdown. “This year, I am planning to buy both. The company has announced a salary hike and a bonus of 7-10%. I am now in a better position to get a loan,” he said.

Attrition levels up
The improving market sentiments have also resulted in a rise in attrition levels, as companies have started to pay premium packages to hire skilled hands from other companies. An Infosys employee said attrition levels have gone up and most employees were going to rival firms like Tata Consultancy Services and Wipro, which are offering a 40% hike in salaries. “We are expecting a salary hike of 8% this April,” he said. He said that during the tough times, they had to put in six hours of work, which was considered a full day. “Now, spending 3.5 hours is considered to be a full day,” he said. Due to the economic meltdown, issues related to the work environment, employee benefits and innovative programmes were put on the backburner. Companies were not too transparent in informing their employees about key decisions taken in the organisation. Many employees said that some companies are exploiting the situation in the name of recession. Ajit Sivaraman, a 26-year-old techie, shifted to Tesco — one of Britain’s largest retail groups — to do the IT-related work there. The company offered him a 60-70% pay hike. He is now planning to buy his own home with an investment of around Rs 20-25 lakh. “I used to earn between Rs 1 lakh and Rs 3 lakh. Now I get Rs 3-5 lakh in the new job,” he said. He said his previous organisation even changed the cab facility to bus service for morning shift employees and offered staffers Rs 75 per day, if anyone wanted to come on their own. “It costs me Rs 200 per day to commute. They even cut our Sodexo meal card,” he said.

Talent reward programme
A Satyam professional said salary hikes were based on a model called ‘Smart’, with employees coming under the so-called ‘S-band’ receiving a salary hike of 20%, while those under the T-band received an 8% salary hike. He was expecting hike of 15% in April and plans to buy some property. “kI was earlier looking to move out as there was a lot of uncertainty and attrition levels were high. I don’t have plans to move out now,” he said. C Mahalingam, executive vice-president and chief people officer at offshore product firm Symphony Services, said his company was giving a salary hike of 7-8% to their employees and 8-9% hike to its top talent. “Companies are now hosting lunches and dinners at five-star hotels for their top talent. But the fun-and-frolic approach to keep employees happy may not come back in the near future,” he said. Mid-sized software and R&D services firm MindTree said it is focusing on a good communication network and is keeping employees informed about every development. “Employees do not expect free lunches and gifts. But they want to be treated as professionals, and their seniors to be more approachable,” says MindTree chief HR Puneet Jetli. IT services firm MphasiS has announced a recompense bonus for its staff which the company feels is possibly an innovative compensation model as it is based on the company’s performance and employee’s individual performance. “We have given a recompense bonus of 25% for the highest performer. For good performers, the bonus can be 15-25% higher than the average pay hike,” MphasiS chief human resources officer Elango R said.

According to Ajit Isaac, MD & CEO of IKYA Human Capital Solutions, many companies are planning a 12-18% fixed salary hike for senior employees and 5-15% salary hike for employees at the operations level. But captive centres, which were earlier paying lucrative salaries, won’t be able to keep the pace. “This is because outsourcing margins and billing rates are under pressure as a major chunk of outsourcing contracts are going to third party vendors,” he said. An IT employee at Keane, a technology services company, said she has received a salary hike of 10-12%. “Last year, there were lot of structural changes to combat the recession,” she said. The New Year has certainly brought some smiles back.

MindTree: Looking for Buys in $50 Million-$100 Million Size

BANGALORE -- MindTree Ltd. is looking for acquisitions valued at $50 million-$100 million to help in its bid to post $1 billion in revenue by 2014, the Indian software exporter's chief executive said.

"I would think, maybe 20% of our revenue would come from acquisitions as part of this $1 billion vision," Krishnakumar Natarajan, who is also the managing director of the company, told Dow Jones Newswires in a recent interview.

The company had reported $269.1 million in revenue in the last fiscal year ended March 31.

The company is looking for acquisitions to expand its infrastructure management and package application businesses, Mr. Natarajan said. MindTree's last major acquisition was in 2008, when it bought product-related testing services firm Aztecsoft for $90 million.

Bangalore-based MindTree specializes in providing services to the manufacturing, banking and financial services sectors. Like its peers, it is slowly recovering from the effects of the global economic slowdown as technology spending makes a modest return in developed nations.

Mindtree Meets With Corporate Information Systems

Started in 1999, Mindtree is a global IT solutions company, with just under 8,000 employees in 20 countries. As a practice, the company gathers its best minds every year in Bangalore to participate in the company's annual planning exercise. With the slowdown, that seemed like a luxury.

Highlights

-- The corporate information systems (CIS) team included video, IM, and presentation sharing capabilities.

-- The initiative, which cost Rs 14.25 lakh (US$30,360) saved the company just under a crore.

"The unprecedented turmoil required MindTree to scrutinize every expenditure item," recalls Sudhir K. Reddy, CIO, MindTree. "One day, I received a call from our chief strategy officer asking me if there was anyway to minimize travel for the annual plan meeting using technology."

Reddy examined telepresence-on-rent and HD video conferencing. But given the size of the meeting - 120 people from up to 14 cities around the world - and the duration of the meeting - six full days - Reddy and his team quickly zeroed in on video collaboration.

The solution Reddy and the corporate information systems (CIS) team deployed included video, IM, and presentation sharing capabilities. An audio bridge was kept as back up.

Reddy's team then evaluated the voice and video quality over different conditions. An optimal configuration was demonstrated to two top management representatives and when they got the go-ahead, the team asked for the meeting's timetable. The list of participants was broken down into those from the local MindTree campus and those from elsewhere. Cameras were shipped to all participants at remote locations. Test conferences were scheduled by CIS teams in all time-zones.

"We had carefully reserved about 384 kbps per external participant and all conference rooms (about 15Mbps in total) to ensure that the video did not freeze or break-up," says Reddy.

But the solution wasn't all technology. The senior management team, which was not used to conducting such important meetings over video conferencing let alone desktop video conferencing, needed convincing. To ensure the technology did not let them down, 10 CIS members babysat the meetings. "If we had to attribute our success to one factor, it would be the meticulous planning and orchestration of the event by the CIS team," says Reddy.

The initiative, which cost Rs 14.25 lakh saved the company just under a crore.