IT employees under scan

Wipro Tech puts 3000 staff under scan
Wipro Technologies has put about 4-5% of its workforce, about 2,400-3,000 employees, under the scanner for non-performance. While some would be given counselling to improve their performance, others would be asked to leave.

Wipro’s corporate vice-president (human resources) Pratik Kumar confirmed the move. “It’s a regular annual exercise. As the appraisal cycle gets over, a multi-layer review happens. Following that, people who have fallen in the lower quadrants of performance are put on watch. Some are asked to pull up and others are asked to move on,” he said.

Asked how many employees had been asked to move on, he said the company did not disclose that number, but it was “significantly lower than 2,000”. Company sources said about 1,000 employees were being asked to leave. “I can’t comment on a particular number,” Mr Kumar said, when asked to comment. The review includes all the 60,000 global IT services employees from the senior leadership team down to the person with one-year experience.

In February, Tata Consultancy Services (TCS), the country’s largest IT services firm, had given pink slips to 500 non-performers. IBM, too, had asked about 700 employees in India to leave, citing non-performance. In July, Patni Computer Systems had shown the door to 400 employees. While IT companies said the move was not linked to the slowdown in the US, a key market for IT services, there was a consensus that it was time for belt-tightening.

At the end of the quarter ended June 2008, Wipro’s IT services employee base had fallen to 61,345 from 62,070 employees at the end of the previous quarter.

“It’s not just our view, but the industry’s view, that we have to be thoughtful of additions and drive productivity. We took a closer look at our hiring and realised that we did not need to hire more, since there were people on the bench,” Mr Kumar said. Bench refers to the buffer of employees not assigned to a particular project.

As the company works towards improving utilisation rates while keeping a tight rein on employee additions, its bench strength would come down. At the end of the quarter ended June 2008, Wipro’s utilisation rate was 78% (excluding trainees) and 74% (including trainees). “We want to raise utilisation by 1-2% during the year and the bench strength would go down by a similar percentage,” Mr Kumar said.

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