While one section of the Indian IT sector is facing acute attrition rates, there are companies like Cognizant Technology Solutions or CTS cutting down on their staff strength and laying off employees considered redundant. What’s more, the company appears to be slowing down the intake of freshers too.
Not all those issued letters of employment in March this year have been called up to report for orientation. All these are reportedly part of a broader plan being put in place by the new CEO of CTS, Brian Humphries. The company’s spokesperson though has not confirmed these developments saying its business as usual.
It is not as if the company is asking employees to leave just like that. The report says when a performance appraisal is carried out, those not clearing all parameters may be indirectly told that the countdown may begin and they must look for opportunities elsewhere. It is the same with employees on the bench. If it is felt that they may not get any assignment for a reasonable period of time, then they will go into that list where the process of their being eased out will start. The overall reduction in the staff strength may only amount to a few hundreds, the report claims.
The new CEO is apparently in favour of taking up a total restructuring of the organisation and several steps are being taken to cut down the flab. One of the decisions taken has been to look at making the salaries linked more to performance or making it a variable component-heavy salary than the fixed part. There are other steps like cutting down on travel expenses, where found unwarranted etc.
All these developments at Cognizant come after a year that saw the number of employees going up but the revenues not keeping pace. The company says it suffered on the margin during the year due to this. This June, CTS had a headcount of 288,200 whereas 12 months earlier, there were 268,900. Roughly, 70% of their workforce is deployed in India.
The development on freshers being held back came from a Facebook group that goes by the name ‘Cognizant Freshers’, but the company claims the information is not true and that the intake is already happening and there are thousands of freshers undergoing training at the Cognizant academy.
The CEO has addressed a communication directly to all the employees telling them how it is important to cut costs but has sounded quite confident that they will be able to achieve the results they have set out to do.