Beyond Layoff

An interesting article in Deccan Herald (cross posted from New York Times) today highlights how it employs 1,30,000 people in India - about one-third of its total workforce, and more than it does in US. Key highlights from the article: IBM opened its first Indian offices in Mumbai and Delhi in 1951 is now spread across the country, including Bengaluru, Pune, Kolkata, Hyderabad and Chennai. The company employs 130,000 people in India — about one-third of its total workforce, and more than in any other country.   IBM is unusual because it employs more people in a single foreign country than it does at home.  The company’s employment in India has nearly doubled since 2007, even as its workforce in the US has shrunk through waves of layoffs and buyouts.  IBM employs well under 1,00,000 people at its US offices, down from 1,30,000 in 2007.  Depending on the job, the salaries paid to Indian workers are one-half to one-fifth of those paid to America...

A couple of days ago, we looked at NASSCOM''s forecast of "Indian IT sector to see up to 38% fewer jobs this fiscal" This week, ZDNet posted an analysis "It's time for TCS, Wipro, and Infosys to say goodbye to double-digit growth forever" The results from the most recent quarter that ended in June 2017 are just in and there are no surprises here amongst the big three in Indian IT. Using this impetus to wean themselves off of low-end work and gravitate towards more value-added assignments could save Indian IT. TCS, India's largest IT services company, posted a 5.2-percent growth in revenues (in dollar terms versus a year ago) as well as a 7-percent drop in net profit. Mint newspaper, observing that it was the company's "11th consecutive quarter when the company has either under-performed or at best managed to match analysts estimates" called it a result of "unimaginative leadership" in a separate piece, which is an un...

This was an interesting question from an online forum. Another similar question that came up. Is it true that Cognizant is planning a mass layoff in the upcoming months? Rumours has it there are plans to layoff as many as 20,000 people from the company. As a result there has been a delay in the appraisal cycle as well. Seniors or any people well informed kindly shed some light into it. To respond, let us start by looking at the basics: The business model in the western /developed countries are much more ‘business friendly’ and many states in the US have "right to hire" or “employment at will” laws. What this means is simple: Employers can terminate employees “without cause,” just like employees can leave a job without giving a lengthy notice period. However, employees who are part of such involuntary termination can file for ‘unemployment benefits’ till they find another job. Software service companies in India operate in the same global environments...

Forum For IT Employees ( FITE ) continues to get a lot of media attention An IT Workers’ Union: Outlandish Or A Sign Of The Times? Bloomberg wonders, adding "India’s software services industry faces a twin challenge: U.S. President Donald Trump’s protectionist policies and automation. And as companies lay off staff, a group of employees is now trying to form an IT workers’ union. There’s been a growing sense of insecurity among the IT professionals over the last few years, said Elavarasan Raja, a 27-year-old IT worker from Pune. That’s led the group to try and form a union to better protect employees’ welfare, said Raja who is part of the group. Called the Forum For IT Employees, the group now has around 3,000 members and chapters in nine cities, including its headquarters in Chennai, and in prominent IT hubs like Bengaluru and Pune, according to Raja. The group, in a recent press release, alleged that Cognizant Technology Solutions was illegally terminating thousands of emp...

The Indian media has already begun speculating on the impact of layoffs in IT sector on other parts of the economy. Take for example the Real Estate sector, which was already struggling post demonitization of Indian money. Some industry watchers are closely looking at the impact of layoffs and slowdown in IT sector on the housing market, especially in major cities like Bangalore, Hyderabad, Pune, Chennai and elsewhere. Against a backdrop of such news and layoffs comes news that TCS plans to add 3.75 L sq feet office space in Bengaluru Job losses in tech sectors may reduce home sales in IT hubs (Economic Times) MUMBAI | BENGALURU: Recent news regarding job losses in the key information technology sector that has driven job creation over last two decades is threatening to unnerve residential real estate in IT hubs across the country.  The unfolding scenario may push homebuyers in major property markets in cities including Bengaluru, Hyderabad, Pune, Chennai and Gurgaon into a...

Hiring and firing are a common business practice in the west. The typical American spends about 4.2 years in a job ( link ) and sometimes leaves for better opportunity and at other times may be fired or laid off. The phenomena was glorified by reality TV shows like The Apprentice with Donald Trump’s punchline “You’re Fired”   ! Googled image Even considering the fact that layoffs are a common business practice in the west, the impact of a job loss is hard on individuals. Many psychologists and researchers classify “Job Loss” among the top 5 stressors for people, ranked with the “Death of a loved one,” Divorce, and Major Illness! Let us switch to layoffs in India, more specifically layoffs in Indian IT which is in the news a lot. The news of layoffs come at a time of additional scrutiny on employment-visas in the US, UK, Australia and elsewhere, and a general slowdown in the Indian IT (my earlier response to a question). For those laid off involuntarily,...

Every year, about 400,000 graduates with Engineering and Technology degrees from varying branches/disciplines graduate from universities in India. In addition, hundreds of thousands graduate with other degrees, including computer applications, commerce, science and arts.  In the past years, companies like Infosys, Wipro, TCS and others would go to campuses and hire tens of thousands of Tech graduates and send them through boot-camp like training that focused on programming and software engineering. Googled image Years ago, when I first started my career in IT, my manager – a seasoned veteran – gave me a simple piece of advice that holds true to date. When I went to him for advice for career planning he ended with the old Chinese quote “Give a man a fish and you feed him for the day. Teach him to fish and you feed him for life” Source (beliefnet) In 2017, this hiring has slowed considerably and 2018 may be no different.  If you are a fresh graduate, y...

People are wondering about the state of Indian IT. A number of media articles are claiming "Up to 600,000 IT engineers are likely to be laid off in the next 3 years. (link)" Why is this happening? First things first, this is not the time to panic over headlines, especially when there are a lot of rumors that are circulating. Journalists – even those with little understanding of the business of IT - are having a field day churning out articles with sensational headlines. Many articles are focused on Trump administration’s policies and restrictions on visa and immigration. Some are parroting claims by leaders of software services companies that productivity gains and automation of tools and processes needs a lesser number of people. Some analysts are also claiming the need to reskill on emerging technologies including big-data, AI, bots-and-robots etc Some of this may be true, but doesn’t explain the churn of tens of thousands of jobs. There are a couple of black-swan ...

As we know that there are few IT giants, who are asking their employees to leave organization in good terms. So, my query is, will it affect SAP SD Consultants (SAP Core Module Consultants)? My Experience in SAP SD is 2 to 3 Years. Please Explain!!! Let us start by understanding the context of ‘layoffs’ Check out My2cents on that topic “ What is the reason behind the layoffs in IT firms in India? Is it related to the H-1B visa, or some other reason?”)  Let us look at the question from a couple of angles Are SAP SD skills marketable? The skills certainly seem marketable. There are a few hundred jobs posted on LinkedIn (India), many posted by Infosys, Wipro, HCL etc. Will a company retain SAP SD consultant on long-term bench ? Let us assume you work for a services firm (“IT Giant”) that just lost a large account where dozens of SAP SD Consultants worked in a support role. After waiting for a while, they may decide to layoff *all* the folks on bench for more than 2-mon...

I happen to be a product of Indian IT. Having lived and worked in a dozen countries across across three continents, I have seen layoffs and its impact up-close. The question is very apt and timely given the news accounts of ‘thousands’ of layoffs by Indian IT Firms. (My2cents on that topic “ What is the reason behind the layoffs in IT firms in India? Is it related to the H-1B visa, or some other reason?”)  Although the Indian media is fixated on the term ‘layoff,’ some of it is voluntary headcount reduction etc. In the short-term, layoff is hard. Loosing a job is hard for obvious reasons. However, I have also seen many successful guys and ladies use the opportunity for self-reflection. If you are (relatively) young and happen to be laid off, you should begin by reflecting on your career thus far - you may realize that jumping back to yet another coding, software engineering or project management role is not really your cup of tea. Listen to your inner self Reboot and re...

This was a question that came to me from an online forum. Expanding on it, the person asked: Is it related to the H-1B visa, or some other reason? What impact will this have? My response follows Years ago, I worked for Infosys and at that time, we had an "assigned curve" based appraisal system. I think it was called ‘CRR’ (Comparative Relative Ranking) where about 5% a pool of employees would get an A+ Next 5% would get an A Another 50% would get a B (or B+) Another 20% would get a B- Remaining 20% would get a C (or Performance Improvement Plan – PIP) The company had about 30-40,000 employees. At any time, few hundred employees would be under the PIP.  Many who got a ‘C’ during a cycle, strived to work hard and improve and some folks banded into PIP for two cycles in a row were asked to ‘seek other opportunities.’ No drama. No news. Of course, the Indian IT sector was booming and many employees graded -rightly or wrongly – into the bottom rungs would ...