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Attrition worries TCS, over 7,000 employees quit in Q1

By SiliconIndia   |   Sunday, 18 July 2010, 19:42 Hrs   |    50 Comments
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Attrition worries TCS, over 7,000 employees quit in Q1
New Delhi: The attrition rate in IT services firm TCS shot up to a 13.1 percent during the first quarter of this fiscal. With the rise in attrition level taking a toll on the company, TCS is set to bring about a change in its human resource management.

"Our attrition has gone up this quarter. Almost 7,000 left the company during the June quarter," said TCS Chief Executive and Managing Director N Chandrasekaran said. "But we have done a good job of retaining key performers," he added.

Utilization of HR in Q1 stood at 82.6 percent (excluding trainees) and 74.85 (including trainees). The company added a net 3,271 employees during the quarter, raising the total strength to 163,700.

"Given the strong deal momentum and continuing ramp ups, we have decided to increase the hiring target for the current fiscal to 40,000, an increase of 10,000 from the previous estimate," Global HR Head Ajoy Mukherjee said, adding "there are strategic exits. Our focus would be on retention, which is critical. This would be our top priority."

The company reported a better-than-expected 24.25 percent jump in its June quarter profit at 1,906.07 crore. It said it is eyeing a strong demand for outsourcing services and is chasing 15 large deals across the globe.

"In the first quarter we've already signed 10 big deals. And now we are looking forward for another 15 large deals in various sectors across the globe," Chandrasekaran said. The company had a net profit of 1,533.94 crore in the June 2009 quarter.

Total revenue rose 14 percent to 8,217.28 crore in Q1 up from 7,206.99 crore in the year-ago period. "Our balanced growth was driven by disciplined execution and strong demand across markets and industry sectors. Our holistic growth across service lines highlights the growing traction among firms for our full service strategy," Chandrasekaran said.

Reacting to the results, IIFL research analyst Rajiv Mehta said, "TCS reported numbers significantly ahead of our expectations. It posted a strong operational performance with 8 percent volume growth and marginal decline in operating margins. The growth is broad-based with all verticals and services growing in constant currency. Its revenue visibility has been boosted by multiple large deals wins in the quarter and the pipeline is also strong. We expect TCS to outperform in the near-term."

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Reader's comments(50)
1: Unlike going for the general/traditional practices, it is good for to go for innovative things but it is not really appreciable if copied. The top management should look-over practices that brings a top cutting, competitive edge over the other competetors in making the employees stick but not in the name of loyalness. "Pay and get paid should be the strategy for TCS now".

For a company like TCS growing good for business can't really sustain in the market with no employees to do for it.As the no. of employees are high in TCS and the top management look so, not of experience should have to reach for the mentors , mentors from the parent co. might help them out in managing this issue.
Posted by:MadhuSudhan Gaddam - 31 Jul, 2010
2: Being in TCS it is hard to tell this way, When the recession was there there was a drastic cut in packages, I haven't heard any of my colleges complaining about it, but in return they expected good returns, but instead TCS new management came, after Mr.Ramadorai, during the recession when the company was nearly unofficially controlled by Mahalingam, where the worst of cost cutting took place, they cut AC (that too in a closed environment, or they will switch on just blowers and they re circulate the air that is inside the office, you can understand guys that is a miniature of NAZI camp torch-ere), Believe guys the height of cost cutting went to no tissue papers in toilet (thank god they didn't sell water and pay and use toilet). TCS copied the policy of ISU from Infosys (Honestly these management just copies from Infosys, they do what ever they info-sys do, but they leave any good things with it and wont reorganize properly which suits this organization. I don't know whether Ajoy Mukerjee is really a stupid or he is forced by Finance and other big heads to make a stupid policy of promotion with no hike, or hike after an year. TCS top management tries to put TCS as higher profitable organization by cutting the pay of the employees, but it will work only in a very short run less than an year for some quarters they can show off, but it leads to higher employee dissatisfaction which will surely increase attrition, leads to poor delivery and dissatisfaction of clients and finally to loose image in front of customers. Already Sathyam created and negative image, followed by CSC in Scandinavian countries, and next TCS again will do the same globally, Even now its not late, If TCS management wakes up and do better to restore employees with good HR practices, policies and better pay package, (when they can give 7lacks package for some one who joins the company with 3 years of exp they want to pay the same for 5 years who is in tcs the same package), Obviously every once goes out for a better pacakge, Its outdated to say "loyalty to company" and other things when every company looks for financial benefit every employee will also look for it, Management cannot take advantage of saying that age old stories, its changed in the market, it is getting capitalized market and don't think people still have that old mindset which makes them more vulnerable to get exploited.

If Tata Steel made a big loss of corrres deal, don't exploit the group companies employees to pay for it, increase the profit by cutting their pay and diverting to manage the loss will not help, instead be brave to dump the deal.

I still have the respect for TATA group and its contribution to the country, but the new management is trying to break that good image in the globe.

Wake UP TOP MANAGEMENT of not just TCS, even though the forum said about the TCS the same case exists in many other companies. Wake up, don't pretend in front of media, be realistic, then you will survive in market, The market goes naked and you cant hide more hence the inside information is no more inside when you try to exploit, like the Attrition came public.

Last not least, look for benefits, but remember everyone look for the same, if you try to overlook it then you will loose, in more simpler way live and let live.
Posted by:Shiva M - 25 Jul, 2010
3: Atleast TCS is honest abt it..unlike IBM
Posted by:utsav - 25 Jul, 2010
4: Players in the market tend to boast about best practices. Hope this is not one of them.

Well from a brand credibility point of view 7000 souls got to say bye in a different way "tata".

Wonder if there is a thought process to correct the same.
Posted by:Tathagat - 24 Jul, 2010
5: This is a clear outcome of Bad HR play in another IT company. It is clear that HR is the out and out unsuccessful function in most of the IT companies the bad management adds fuel to it. Anyway, Happy changing guys
Posted by:Kalyan - 24 Jul, 2010
6: God sake India is still encouraging more outsourcing Orgs and even investing lot in this bizz.

Thank god that really a big change in the nos of unemployment comparing to last two decades. Hope, now we continue our demands of salary hike ever.

Jaihind!
Jaihind!
Posted by:Rohith - 23 Jul, 2010
7: Yes Its a govt like company . I think they are not retaining the people even very good performers [Bez they could not validate who is good / bad ], key technical people are leaving bez there is no policy that they can increase the CTC so as to retain the people.

Mainly the attrition is due to
* Due to best CTC in the market
* Getting onsite oppr is luck
* At present many people are locked by h1b. Only god will know the status of the visa
* promotion but salary hike will be after 6 months to 1 year
* At last due to some bad leadership / manager

Good technical people are hesitate to join / 4 yr guys asking 12 lak salary....
Posted by:saran - 21 Jul, 2010
8: any organisation must require better counter checking mechanism. (vigilance,skip level meeting,whistle blower,etc)
if not even presence of better policy also foiled by bad top peoples.
Posted by:kittamani - 20 Jul, 2010
9: TCS, HCL, Infosys or for that matter anywhere, it is the wrong HR policy that is the culprit! Why should employees leave any organization in large numbers? If HR policies are not favouring continuing with an organization, it is real hell, for the employees. In these times when every organization in the world is adopting to changing circumstances of HR needs and becoming progressive as far as their HR policies is concerned why is that a few organizations take the reverse path, to self destruction? Adopting retrograde HR policies, will ultimately spell doom to the organization. The employers should realise this fact sooner. This is only because people with rotten minds are placed in high levels of HR. This trend should come to an end, the sooner the better
Posted by:SOORAJ KUMAR P M - 20 Jul, 2010
10: TCS HR & company policies are very old and belongs to bygone era. It works like an old PSU and not at all upgraded at par to today's educational/job scenario, thanks to their so called oldy/goldy Managers who've started their careers way back in 60's & 70's when there were only couple of career options to choose. Their level of thinking is which runs TCS and result is in front of you my friends.
Posted by:Shan - 19 Jul, 2010
11: The attrition rate in HCL is even worse. Since this year beginning, between 30-40% people would have left the technology division of this comapny by July end. At a time, situation got so bad that top management had to ask the HR dept to stop attrition because of salary issues at ANY COST ! Ironically, HCL was rated best employer by someone recently. I don't know when these figures would be released or would they ever be relaesed officially.

The company is recruiting people from non-engineering backgrounds. Such people are happy to join HCL brand for peanuts. These new employees might balance the attrition rate for HCL in coming years, but, service quality would inevitably suffer a lot.

HR in the company are as good as in other Indian companies. Good for nothing. They have now resorted to last minute disaster management by offering hikes to only people who are clever enough to put forward their resignations, when their older couterparts have already produced many ripples of worries in higher management.

The core of the problem is that the Human Resource department is least concerned towards those who are presently not in position of leaving the company (Experience
Posted by:A K Jain - 19 Jul, 2010
12:
Trust me buddy, today's engineers are good for nothing... I Most of my colleagues are engineers and the way they apply their minds is, quiet simply put, PATHETIC...
nova Replied to: A K Jain - 25 Jul, 2010
13:
Dont tink that only engineering graduates only knows everything even they are also good for nothing........
pramod Replied to: A K Jain - 21 Jul, 2010
14:
At least Engineering Graduates qualified the joint entrance.
p k mukherjee Replied to: pramod - 22 Jul, 2010
15:
The core of the problem is that the Human Resource department is least concerned towards those who are presently not in position of leaving the company (Experience
A K Jain Replied to: A K Jain - 19 Jul, 2010
16:
(Experience less than 2 years). They only chase those who are planning to leave or bother about filling in the void somehow, to balance the numbers.

The classic example would be 2008 batch On-campus recruits. Under recession, the company literaly had a license to delay their joining for one year. Even after that period, the people hired for HCL Technologies division (cream among graduate engg from best of the colleges, as per HCL's caliber) were just thrown into Infrastructure division and that too in places like monitoring and Servicedesk (another name for BPO segment).

One could understand such a move in hard conditions that prevailed in 2009, but, it become incomprehensible when even an year later, this batch has been totally ignored by HR and no effort has been put forward in time to restore the career path of such freshers. As soon as their bond period gets over , all these would surely rush out of the company and then the company will think of disaster managemnt.

Typical of Indian HR mentality !
A K Jain Replied to: A K Jain - 19 Jul, 2010
17:
Strongly Agree to your view. Infact, I think you have just highlighted the key areas of HR mismanagement. Although, am not working for HCL, I can fully resonate on your take on the HR workways in my workplace.
Especially true about the hiring of non-engineers for balancing the numbers and therefore degrading service quality.
Also true about the HR focus on people to compensate with salary hikes and all kinds of perks (like re-location preference, onsite opportunity)to ONLY those who put down their papers. Why dont they anticiapte this and take a proactive approach altogether? They indeed just resort to disaster management - very typical.
RKB Replied to: A K Jain - 19 Jul, 2010
18:
But guys! What will your PM or any top managers will do that time, why don’t they offer suggestions for increments / Promotion for the right persons in right time.I don’t think performance is really measured by the HR directly. So retaining people should be part of KPI for the project head / HR both.

But no one will accept with your statement that “Especially true about the hiring of non-engineers for balancing the numbers and therefore degrading service quality”. There is nothing to do with engineering education for now-a-days BPO jobs. Anyone how is smart in speaking/ listening / executing can manage anything.

God sake India is still encouraging more outsourcing Orgs, really a big change in the no of unemployment comparing to last two decades. Hope we maintain the demands.

Jaihind!
Jaihind!
Rohith Replied to: RKB - 23 Jul, 2010
19: all the comments are correct as per every ones view///main motive of any company will profit earning///tcs is concentration on that////offcourse company cannot satisfy every employeee///about salary hike and pliceies: as very one says the company polices are not good as other companies////////but the oppertinuties are more u can learn////////// what ever reviews we discuss here its waste of time as it do effect the company or change in policess
Posted by:jagadish - 19 Jul, 2010
20:
I think almost all the companies are playing in the same way, especially in India because of poor/corrupted govt. Both the Management (organization) and HR policies to be reformed. Also Indian govt must induce new rule/act to protect private employees especially IT&ITES. Also they should induce new act to pay to unemployed people (who lost their jobs) as they were collecting huge taxes. I am planning to start a UNION for this. Any one interested? This union to protect employees from organizations/managers/HR people who always talk for organization.
Mr. Right Replied to: jagadish - 19 Jul, 2010
21: TCS is far far better than GATEWAY TECHNO LABS .. any one heard about GATEWAY TECHNO LABS which is in Ahmadabad based IT company it has only 200 employees and In market they said 800+ employee.. and worst to worst Employee Policies and no managemnt.olny they have moto how to employee suffer. alomose all employee planning to leave.even i hav plant to leave.. if TCS get me chnage then i will suerly join TCS ASAP.and i will fetch whole business from GATEWAY TECHNO LABS....
Posted by:Parthiv Kansara - 19 Jul, 2010
22:
Think what you are writing and comparing....
Sudh Replied to: Parthiv Kansara - 19 Jul, 2010
23:
Looking to your standard of English from your post, I do not think TCS will be too eager to appoint you - atleast not for overseas projects.

You are also talking about giving away confidential business information of GATEWAY TECHNO to TCS. TCS will risk the same when you plan to move again elsewhere. Parthiv 'Kansara' .. going back to 'Kansara' business may be more suitable if you can.
Nisha Replied to: Parthiv Kansara - 19 Jul, 2010
24:
As far as I know , Parthiv is very honest and mature person.He is a Tech Lead, and works in technology domain, not in business development.well I think his name has been used by one of jealous co-worker/manager of Gateway Technolabs.

God Bless her/him .
Prady Replied to: Nisha - 19 Jul, 2010
25:
@ Nisha,Sudh.
This is common place where we can post our view. You are not the right person to comment on someone like that.

@Parthiv posted his own views. We are judging his grammatical mistakes.

God Bless.


kuldeep singh Replied to: Prady - 20 Jul, 2010
26: oh man they will recruit very cheaply like Chinese items and in the end all moves out like migrating birds.A COMPANY WITH NO GOOD POLICY!
Posted by:sumod - 19 Jul, 2010
27: Guys those who are hungry for packages..lets vacant the place for me..i am coming to TCS cheers :)
Posted by:Bbek - 19 Jul, 2010
28:
a jao ekbar...hab bamboo ghusega na..tab pata chalega...
raktim Replied to: Bbek - 19 Jul, 2010
29: TCS should take care of the employees working with it.
Posted by:Vinay - 19 Jul, 2010
30:
TCS is giving very low packages..I tthink they should increase their remuneration else more will quit.
Vivek Replied to: Vinay - 19 Jul, 2010
31: Manager sucks not HR or HR Policies....
But yes...if someone is oredi lookin for a new job due to Manager...these bad HR policies works as catalyst. Am hoping for a change in INDIA, there is always a window for improvement.. just go good by ur side...
Posted by:Mogli - 18 Jul, 2010
32: Do we have really good HR policies in any of the IT company
or does good HR policies make difference as if you are looking for change or you are not satisfied with manager or company.

I heard ppl are not whiling to change company they change manager. so we should have good managers instead of good HR policies :P
Posted by:Sumit - 18 Jul, 2010
33:
I absolutely Agree with Mr. Sumit.
Deepak Replied to: Sumit - 19 Jul, 2010
34:
Fantastic... I totally agree to this. I think manager is the route cause of changing a job.
Milind Replied to: Sumit - 19 Jul, 2010
35:
I absolutely disagree with this... managers are bound to take harsh decision for you due to the poor HR policies...
I am in one of the leading IT company .There I found that almost a no-hike even in this year but They are recruiting people from outside with huge package...
So is this manager or the biased HR polices whom do you think is the culprit......
sougata Replied to: Milind - 19 Jul, 2010
36:
I Totally agree to this view. Even if you are a key performer you will not be given good hikes except for those who say yes for whatever managers are bound to say, in some cases even before the manager is about to say :)
Raj Replied to: sougata - 19 Jul, 2010
37: TCS has lost its charm.Previously TCS was known as like a GOVT company.But now it the employees has understood that TCS is not like as before.That's why they are switching to other companys.
Posted by:baba2010 - 18 Jul, 2010
38:
even ppl within TCS are feeling changes
Sumit Replied to: baba2010 - 18 Jul, 2010
39: That's really a noteworthy as what is happening in the Indian IT Industry as 7000 exit means 13.1% of existingnwork force leading to a higher exit ratio. The attrition ratio should always be less than 10% or else it may have bad effects for the quality of the manpower produced
Posted by:ABC - 18 Jul, 2010
40: attrition rate can be brought down only through better HR policies.
Posted by:dona - 18 Jul, 2010
41:
Yes, Mr Dona! I agreed with you!
JKR Replied to: dona - 18 Jul, 2010
42:
Need to review pakage structure
sasa Replied to: dona - 18 Jul, 2010
43:
tcs is most pathetic company in india:)
Techie Replied to: sasa - 19 Jul, 2010
44:
Its not pathetic.... its just not managing resources well. Its hiring new people, but not looking at employees who are already working with it.
vinay Replied to: Techie - 19 Jul, 2010
45:
Ibm Daksh is more bad condition than in TCS they are paying like beggers
buffon Replied to: vinay - 19 Jul, 2010
46:
I have drecently joined in an IT company from manufacturing industry. I have limited knowledge aboout IT sector. But I must say one thing, even a lowest paid IT company still stands much better than a well paid manufacturing industry as far as salary package is concerned. But if someone looks for career growth, no doubt that it is better in manufacturing industry.
Prasadh Replied to: buffon - 19 Jul, 2010
47:
I think almost all the companies are playing in the same way. Both Management (organization) and HR policies to be reformed. Also Indian govt must induce new rule to protect private employees especially IT&ITES. I am planning to start a UNION for this. Any one interested? This union to protect employees from organizations/managers/HR people who always talk for organization.
Mr. Right Replied to: buffon - 19 Jul, 2010
48:
Ya me too thinking the same. Nobody cares about what happens to an IT employee. there is no proper union or rules which can take care of the IT guys. The company at any point of time can do whatever they want at its sole discretion, there is no proper to rule to protect IT employees.
rahu Replied to: Mr. Right - 19 Jul, 2010
49:
Hello All,
All I can say that dont think about whether the company policies are good for you or not. Dont whine about whether TCS is a good company or HCL or Wipro or Infosys. All of them are same. One should think about whether staying in a company is aligned with his own personal goals and his domestic obligations.
Take one example, one of my friend was about to leave a big IT company in india last year in the midst of the recession but his father suffered a severe heart attack and was required to do an emergency bypass surgery. He had no choice to stay back with the current BIG company as the new job would have required him to prove himself once again where as in the existing job he was the one working since a long time. So it was easy for him to bargain with the PM that he will work 1-2 days from home and whenever required as his father is ill. PM had to agree as he was a key member. So it took almost an year for his father to get well after the surgery.
Now he is a free bird. He put his paper and bargained again with the PM,HR. Now he is set to get married in October. So after marriage he is onset to get onsite, good salary hike, promotion which was due next year.

So the morale of the story is create your value in the team/BU/company, show efficiency, always try to sharpen, update your techno-functional skills.
Think as if you were the CEO of the company, what you will chose, giving 20% hikes to the employees and then making the profits less than 20% where as your peers are giving it for more than 25% which in turn may piss of your stake holders or giving 10-12% hike and making profits more than 25%. It's all about money. No company is here for charity.

It's prior that prior to the recession, employees were the king, during the recession it was the company, and now again it's the employees.

So think about yourself, not the company as we all are employees.
Rakesh Joshi Replied to: rahu - 24 Jul, 2010
50:
I absolutely accept this point. TCS has never been a employee friendly company...All they are bothered is only revenue, it has become a 10 hrs shift in 2008 and still remain the same...some people spend 5 hrs for travel and more than 15 only for office, hope they spend 8 hrs for sleep all they get is 1hr for family....there are few friends of mine who get to speak to their family once in a week...! There are times due to ego issues between the mangement the associates are being tortured! The associate is helpless and if the associate points out the mistake and escalates to get his/her work done then he/she is cornered and DINGED in apprisal which will affect the salary again.... then who on earth wants to stick with such a louzy place where there is no value at all...
Reachme Replied to: rahu - 19 Jul, 2010
Beautiful and dress selection, please go to Dresses
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