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Mindtree employee utilization falls, cuts pay
By Ojas Sharma | Wednesday, 05 August 2009, 19:13 Hrs |
63 Comments
Employees facing this decision are the ones who have been not on project for more than 30 days. Out of the six business unit in Mindtree, R&D unit has been hit hard due to economic slowdown. "R&D consists of customers who build product in technology sector. These customers are people who revolve around semiconductor industry. Semiconductor industry has been worst hit due to recession," says Jetli, who believes that in times like these their customer don't make many products, that's the reason why only R&D unit has been hit.
Jetli also added that there are two ways an employee facing pay cut can start getting his salary back. One is if they themselves start getting assigned to customer projects and the second is if the R&D unit crosses 65 percent utilization.
The company has reported revenue of
3.05 billion, up 36 percent from a year earlier. It also posted a net profit of 567.3 million in the June quarter. But in the quarter ended June 30, R&D contributed only 14.1 percent of Mindtree's revenue as compared to 17.7 percent in the previous quarter.Many Indian software companies have been hit in past few quarters and customers in U.S. and Europe are looking for much cheaper options for product and services. Already, Tata Consultancy Services (TCS) and Infosys have reported a decline in staff numbers for the June quarter. Mahindra Satyam and Hexaware Technologies have asked few employees who are not working on active assignments to take a long leave. "We did not want to send people to virtual pool or layoff. So this is just the short term process. Some organizations have put their employees on 40-50 percent salary. We did not want to take any such drastic action," added Jetli.
If the situation does not improve in the R&D unit it is possible that number of people facing a pay cut might increase. At the company's first quarter results announcement last month, MindTree Chief Executive Krishnakumar Natarajan had predicted that the company expects the growth to be muted in the next few quarters. This move by Mindtree proves that the company might have to make many changes to fight and adapt to the slowdown in Indian IT sector.
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Reader's comments(63)
2:
Mission of MindTree
Successful Customers (No Comments)
Happy People (With High Pay Cuts)
Innovative Solutions (To reduce salary and other Benefits)
MindTree Values
C Caring
L Learning
A Achieving
S Sharing
S Social Responsibility
Do they still Care
Successful Customers (No Comments)
Happy People (With High Pay Cuts)
Innovative Solutions (To reduce salary and other Benefits)
MindTree Values
C Caring
L Learning
A Achieving
S Sharing
S Social Responsibility
Do they still Care
Posted by:Silence_talks
- 14 Aug, 2009
3:
Its nothing NEW in Indian IT sector, every companies is doing the same. fron Infy too some ABC Computech ...
Big_Mouth Replied to: Silence_talks
- 14 Aug, 2009
5:
Mindtree-Billion Dollar Dream.........
I think Mindtree Management is hoping against hope.The kind of measures which mindtree has taken to achieve their targets is really disappointing.
Last year they had given the appraisals after 1 and half year just to reduce the cost of resources rather than thinkin about their policies and achievable targets.
No bonus as they kept their targets beyond the imagination.(Its one of the DNA of Mindtree)
This year they are adopting all the tactics to save money
1)laying off the Employees -(Do you think that its a problem of employees -First they recruit the people without realizing whether they actually need it or not.)
2)Taking off the 15 % Salary of the employees.
3)Delaying the quaterly bonus by 1-2 quaters ,by the time employees loose hope to get the bonus.
4)No Bonus ,only false promises about their unrealistic dream.
5)Delaying the promotions by more than 6 months.
6)Recruiting Freshers with less CTC and retrenching the people with 5-6 years of experience.
Its no more the best admired company.its just Publicity stunt.I think top management admires each other ,how they have fooled the employees with their Statistics
If they are impacted by recession then why there's hike among top management people,that too more than 15 % unbelievible.
I think Mindtree Sales team is pathetic ,I don't see any good client in their bucket.Its just when no other company wants to do the business with the clients
then Mindtree comes into picture and employees has face the pressure of work and impossible deadlines.
I think Mindtree Management is hoping against hope.The kind of measures which mindtree has taken to achieve their targets is really disappointing.
Last year they had given the appraisals after 1 and half year just to reduce the cost of resources rather than thinkin about their policies and achievable targets.
No bonus as they kept their targets beyond the imagination.(Its one of the DNA of Mindtree)
This year they are adopting all the tactics to save money
1)laying off the Employees -(Do you think that its a problem of employees -First they recruit the people without realizing whether they actually need it or not.)
2)Taking off the 15 % Salary of the employees.
3)Delaying the quaterly bonus by 1-2 quaters ,by the time employees loose hope to get the bonus.
4)No Bonus ,only false promises about their unrealistic dream.
5)Delaying the promotions by more than 6 months.
6)Recruiting Freshers with less CTC and retrenching the people with 5-6 years of experience.
Its no more the best admired company.its just Publicity stunt.I think top management admires each other ,how they have fooled the employees with their Statistics
If they are impacted by recession then why there's hike among top management people,that too more than 15 % unbelievible.
I think Mindtree Sales team is pathetic ,I don't see any good client in their bucket.Its just when no other company wants to do the business with the clients
then Mindtree comes into picture and employees has face the pressure of work and impossible deadlines.
Posted by:jits
- 13 Aug, 2009
6:
I agree with some of the comments below that mgmt should be the first to take the pay cut. Just take a look at some of the top mgmt salaries (from 2008-09 annual report):
Ashok Soota - 65 Lakhs p.a.
Subroto Bagchi - 64 lakhs p.a.
Janakiraman - 38 Lakhs p.a.
Vinod Deshmukh - 42 Lakhs p.a.
Not to mention the crores of stocks which they have begun selling when the MindTree stock went high. Surely a 15% cut on the above salaries will have a marginal impact on their families, compared to a 15% pay cut for an engineer who is earning 3.5 Lx per annum? MindTree - it's time to walk the talk about your values and DNA.
Ashok Soota - 65 Lakhs p.a.
Subroto Bagchi - 64 lakhs p.a.
Janakiraman - 38 Lakhs p.a.
Vinod Deshmukh - 42 Lakhs p.a.
Not to mention the crores of stocks which they have begun selling when the MindTree stock went high. Surely a 15% cut on the above salaries will have a marginal impact on their families, compared to a 15% pay cut for an engineer who is earning 3.5 Lx per annum? MindTree - it's time to walk the talk about your values and DNA.
Posted by:Robin Hood
- 10 Aug, 2009
7:
I totally agree with you..
If Sales people are not able to bring projects, then why employees of any company should get a cut off their salary..
If Sales people are not able to bring projects, then why employees of any company should get a cut off their salary..
Suman Replied to: Robin Hood
- 11 Aug, 2009
8:
The steps MindTree has taken to hide the mistakes:
1.) Reduce the bonus to employees (From 20% to 3.5%)
2.) Layoff 4% of its employees (Across few months)
3.) Delay pay hike by 1 - 2 quarters
4.) Cut 35% of leaves (7 out of 20)
5.) Cut 15% of salary from the employees who are in bench in one department for more than a month
6.) Increase working hours by 9% - 10%
7.) Stop Promotions after certain level
The following are the mistakes it has committed:
1.) Promotions based on experience than ability
2.) More number of General Managers, Vice Presidents, Senior Vice Presidents and Executive Presidents. As this was not enough, they have more CEO's NOW (More Overheads)
3.) Hedging dollar at a lower limit
4.) Spending huge amount for its 10th Anniversary
And it plans to do more going ahead.
Hope it takes the right measures than the ones that does not take it anywhere.
1.) Reduce the bonus to employees (From 20% to 3.5%)
2.) Layoff 4% of its employees (Across few months)
3.) Delay pay hike by 1 - 2 quarters
4.) Cut 35% of leaves (7 out of 20)
5.) Cut 15% of salary from the employees who are in bench in one department for more than a month
6.) Increase working hours by 9% - 10%
7.) Stop Promotions after certain level
The following are the mistakes it has committed:
1.) Promotions based on experience than ability
2.) More number of General Managers, Vice Presidents, Senior Vice Presidents and Executive Presidents. As this was not enough, they have more CEO's NOW (More Overheads)
3.) Hedging dollar at a lower limit
4.) Spending huge amount for its 10th Anniversary
And it plans to do more going ahead.
Hope it takes the right measures than the ones that does not take it anywhere.
Posted by:Supriya
- 09 Aug, 2009
9:
Rightly Said....
Number of Executives are too big...
Why no cutoff for Executives....
Why No Cut Off for SALES people....
People at the start of their carrier are getting impacted... Its against COMPANY's CLASS VALUES
Number of Executives are too big...
Why no cutoff for Executives....
Why No Cut Off for SALES people....
People at the start of their carrier are getting impacted... Its against COMPANY's CLASS VALUES
Suman Replied to: Supriya
- 11 Aug, 2009
10:
The problem is Mindtree does not take feedback from us employees. If they do, they will know that even if the top two guys - VPs - from Pune center are not around, it will not matter at all. One of them is hardly in office, the other talks only about himself - he wasted time showing family photos to a visiting customer and walked away when it came to serious discussions! But Mindtree management will know this only if they listen to their employees. They should take feedback about bosses and they will know that they can save their entire salaries!
Posted by:ConcernedLead
- 06 Aug, 2009
11:
I agree paycuts are the worst, along with less money the fear of being let go makes for sleepless nights. my company cut my salary by over 20% in December and it really made me upset.
but what to do? economy and finding a new job in this economic crisis was not any brighter prospect. Had to come to terms with pay ut, me and wife decided to cut out all expenses, it was rally ahrd on her, but now 8 months later we have much less stress and no debt. i cannot wait until the py comes back, yeh life ho to hai?
but what to do? economy and finding a new job in this economic crisis was not any brighter prospect. Had to come to terms with pay ut, me and wife decided to cut out all expenses, it was rally ahrd on her, but now 8 months later we have much less stress and no debt. i cannot wait until the py comes back, yeh life ho to hai?
Posted by:jaydeep
- 06 Aug, 2009
12:
Why doesn't the top management take the pay cut instead of cutting the salaries of employees? It is not the employees mistake due to which the sector was poorly performing. The management, marketing and HR team have to be blamed for having built a team and now facing recession. When the top management (starting from Ashok Soota) claim themselves to be role model and example for many, why don't they have guts to show the way by taking pay cut for themselves first
Posted by:Vjtv
- 06 Aug, 2009
13:
Yes I do agree to that, why always should the employee is effected first. ?
Mind Tree has grown by 54% thus qarter still why paycuts ?
Mind Tree has grown by 54% thus qarter still why paycuts ?
Jugnu Replied to: Vjtv
- 06 Aug, 2009
14:
company should just cut on luxury expenses if any like parties, meeting in luxurious places and any other big spending instead of cutting on salaries.........
Posted by:kill
- 06 Aug, 2009
15:
They have stopped CAR facility for onsite people even if 4 people are ready to share that....
But when a Manager or Delivery manager goes... they take it for their own purpose... so that they can enjoy either for outing with client or for their own purpose....
But when a Manager or Delivery manager goes... they take it for their own purpose... so that they can enjoy either for outing with client or for their own purpose....
Suman Replied to: kill
- 11 Aug, 2009
16:
this the best way giving a right justice boss a great answer even some not - some almost every company is giving some kind enternaiment to their employees . there should stop this activity .
lonkas0708 Replied to: kill
- 06 Aug, 2009
17:
This pay cut formula should be use to Management employees, if profit is more this people will enjoy more, if profit come down this people cut all benefit of low level employees. Management should think this all 1st only.
Posted by:Govardhana
- 06 Aug, 2009
18:
instead of reducing the salaries of staff these companies can think develop a product (as Indian companies) or improve quality of their existing products as this expenditure can be capitalized so that the tax they pay can be rreduced which will make their profit more
Posted by:c sudhakar
- 06 Aug, 2009
19:
Cutting pay to employees is not the solution. If there is a resource utilization diminishing then based on skills and technology expertise can be utlized with other projects within different business
Posted by:Anonymous
- 06 Aug, 2009
20:
You give me the Project.. we will proove how to run it... Our work is to work on project....
CLASS VALUES are just for the sake of telling everybody that we have it...
Families are getting hit badly....
So many executives... their children are studying in US/UK... but for an engineer... it dificult to pay a rent and food... nobody bothers....
CLASS VALUES are just for the sake of telling everybody that we have it...
Families are getting hit badly....
So many executives... their children are studying in US/UK... but for an engineer... it dificult to pay a rent and food... nobody bothers....
Suman Replied to: Anonymous
- 11 Aug, 2009
21:
The situation is very much worse than the one companies are showing in market, from an employee's prospective. Only the persons being attacked by the companies' irrelevant actions know that. Companies are not only cutting the salaries and leaves, but they are doing many other activities within the premises that indirectly raises many questions about the integral values of the companies. From some of my acquintances I came to know that Mindtree is cutting leaves & salary giving the excuse of badly hit market, and on other hand they are wasting a huge amount of money in celebrating 10th anniversary on a global front. Also as you can observe in the article above, that this company have earned a profit in last quarter, then why they can't stand by employees also. Even some of the companies have moved a step ahead by cutting the Bonus component (as mentioned by a brother above is the case in Mindtree also) by showing that they havn't achieved the target revenues, but in results they will show profits. These all things point that in India, espacially private sector companies are doing as they want to do. There is no strict law & order to have a watch on them. Also there is a need of mandatory Employee Union sort of body in each private company, as in many of the European companies, which is a body taking care of employee rights in such worst hit scenarios.
Posted by:Anonymous
- 06 Aug, 2009
22:
Good idea! But who will start a union. Somebody should take the initiative.
sheshadri Replied to: Anonymous
- 06 Aug, 2009
23:
The concept of employee unions should be initiated and nourished by Union Govt and also each company, which indeed almost impossible to make it reality in the curent corrupt situation unless there is a big revolution from each one of us so called IT professionals. To give an example in European countries the companies if they have to take the cost cutting measures like Bonus/Salary cut or layoffs, they should convince and get the approval from the employee unions and govt unless they take these measures the company cannot sustain. in case of layoffs unions make sure no politics or injustice involved in choosing people who is getting layed off, and they get compensation based on the contribution, and help them to make sure to get another job within the present company in diff department or in diff company, provide the trainings incase they need one to find another job (all these expenses are bourned by the company which is laying off). untill the person finds another job, govt pays back as un employment benefit monthly.
Now tell me doesnt it sound fair to all of us to get a reasonable support by company and govt who made them to get rich, when the economy is not healthy just make us the victims. trust me this is the reality in European countries. It's time to wake up friends if not now its never going to happen.
Now tell me doesnt it sound fair to all of us to get a reasonable support by company and govt who made them to get rich, when the economy is not healthy just make us the victims. trust me this is the reality in European countries. It's time to wake up friends if not now its never going to happen.
Jaggi Replied to: sheshadri
- 06 Aug, 2009
24:
Yes, I accept this. Where the employees and citizens solely depends on the company. The employers should not show this type cheap attitude.
Yes, I accept this. Where the employees and citizens solely depends on the company. The employers should not show this type cheap attitude.
Ram Replied to: Anonymous
- 06 Aug, 2009
25:
Hey Guys....
"Commenting about the pictur on this article"..
The Rupee Currency note is the legal property of Govt of India any kind of negetive promo-banner or activity is a legal offence and you may be fined and put behind bars.. please apologise and take out this banner from this article..
"Commenting about the pictur on this article"..
The Rupee Currency note is the legal property of Govt of India any kind of negetive promo-banner or activity is a legal offence and you may be fined and put behind bars.. please apologise and take out this banner from this article..
Posted by:Hemanth
- 06 Aug, 2009
26:
Thanks for the comment. We have changed the picture.
Siliconindia Editor Replied to: Hemanth
- 06 Aug, 2009
28:
Hope that author is in deep sleep.. we need to go and wake him up priya..
hemanth Replied to: priya
- 06 Aug, 2009
29:
arise,awake and sllp not until the goal is achieved:-)
go ahead guys..all the best
go ahead guys..all the best
kawaljit Replied to: hemanth
- 06 Aug, 2009
30:
why the hell you worry about that author, wheather he is sleeping and awake, mind you language
Dont Dare Replied to: hemanth
- 06 Aug, 2009
32:
no reply from authors, please remove the banner.
asdf Replied to: Dheeraj
- 06 Aug, 2009
33:
Think we need to seriously think abt it...
hemanth Replied to: asdf
- 06 Aug, 2009
34:
keep thinkin... I guess thats the only thing you know...
only thinkin...
Boss apna hi Bheja kyon fry kara rahe ho...
only thinkin...
Boss apna hi Bheja kyon fry kara rahe ho...
Dont Dare Replied to: hemanth
- 06 Aug, 2009
35:
In India IT companies are making profit
due global economic slowdown, Employers are taking advantage
strict Employment laws are required
due global economic slowdown, Employers are taking advantage
strict Employment laws are required
Posted by:Nadir Sheikh
- 06 Aug, 2009
36:
Rightly said... these companies might be taking undue advantage of recession.
Yogendra Replied to: Nadir Sheikh
- 06 Aug, 2009
37:
Even though the studies report that the market is going to be up in couple of months, Companies who have reported profits also putting salary cut on employee’s shows company’s ethics. Cont companies run with 0 profits to sustain.
All software companies changing their policies then and there because there is no strict Employment law's in India. At least now our Govt should impose some strict Employment laws.
The companies should consider the Dependent's on the Employee before they sack/put cut in pay
All software companies changing their policies then and there because there is no strict Employment law's in India. At least now our Govt should impose some strict Employment laws.
The companies should consider the Dependent's on the Employee before they sack/put cut in pay
Posted by:sri
- 05 Aug, 2009
38:
Am agree with this. Govt should put forward rules on Private companies for the benefit of employees. Now the private sector is doing as they wish...., whether profit or not.., things are imposing on employees...!
vink Replied to: sri
- 06 Aug, 2009
39:
i fully agree with the comment of brick & mortar industries were paid peanuts compared to IT idustry..The equilibrium or law of averages have started working with IT industry where these persons got far more than they deserve in early stages & not may not get enough compared with the earlier..
Only people who has changed their habits with the virtual income will suffer & others who with virtual income but maintain the real lifestyle ( of their ground reality) may not get affected..
Only people who has changed their habits with the virtual income will suffer & others who with virtual income but maintain the real lifestyle ( of their ground reality) may not get affected..
Posted by:girish
- 05 Aug, 2009
41:
what is meant by real lifestyle mr girish? If u r married and have children means u need atleast 25,000 in any metro. Govt will suck Income Tax and won't provide any social security. Plz don't comment like auto driver!
sivaram Replied to: girish
- 06 Aug, 2009
42:
Employees in Software sector have enjoyed a very high pay at the cost of brick & mortar industries employees who were getting meagre payslips. Its time for a change to face the reality.
Posted by:sheshadri
- 05 Aug, 2009
43:
I am not agree with you. this is all about the scenarios. Now u say why IIMs guys getting lots of money and you are not?
aditya Replied to: sheshadri
- 05 Aug, 2009
44:
Also we in s/w industry are getting exact what i am getting. no side earning. if i get 10 lacs PA then we pay tax also . all public sector employees I know earn lots side by side and not paying taxes.
aditya Replied to: aditya
- 05 Aug, 2009
45:
I got an offer from one of the big semiconductor firm and now it is more than two months i did not get any reply,iam in home applying to jobs
Posted by:vishy
- 05 Aug, 2009
46:
Today I have published a blog 'An appeal to all CEOs. These stories really painful to the readers and common man.
Posted by:Nandakumar Kartha
- 05 Aug, 2009
47:
publish the link plz. I want to read.
SKS Replied to: Nandakumar Kartha
- 05 Aug, 2009
48:
Looking at the reports I think this is just the start. The number of people getting pay cut might increase.
Posted by:Kunal
- 05 Aug, 2009
49:
Its not just pay cuts. All other cost cutting measures are being enforced. Last year we didn't receive any Bonus and this year also it seems a distant dream. All increments and Promotions have almost been freezed, only a very few handful employees are being offered promotions. Leaves too have been cut down and by 25% of what we were entitled to.
Sunny Replied to: Kunal
- 06 Aug, 2009
50:
Ya and that handful emplyees includes the top guns what we say from the management like Rostow ravanan.Do they want to show that profit is lowered becos of employees and is not shakling becos of top management.And then further investment of 5 Crores or so on the 10th Anniversary of Mindtree,i don't understand how it will help the empoyees there.
KKS Replied to: Sunny
- 06 Aug, 2009
51:
Well it has been rightly mentioned that top management should take pay cuts instead of employees not in management. I would rather say, can you ask yourself once that if you would have been in top management, would you have liked to take pay cut? Answer is no no.. So people who are higher in the chain, they are the one who makes policy and rules. They are the decision makers. So why should they make such a rule that will harm them.
Ritesh Replied to: Shripad
- 06 Aug, 2009
52:
Hey U. Yes. I Said U SHUT UP and get lost
Mika Replied to: Winner
- 06 Aug, 2009
53:
Yo Guggu.. Gubal nan magne
Saaka atva Innu Beka...
Saaka atva Innu Beka...
Dont Dare Replied to: shripad
- 06 Aug, 2009
54:
I am not sure about the figure ( 4 crores ) you are talking about , if it is so then i am ashame of such organization i am working for. And they are doing it just for marketing,without thinking about their current employees.When asked to our very dear Ashok soota , why are we spending money on it ? " he says "I am sure even in difficult times you would not want to cancel or delay celebration of important family milestones".Well dear Ashok we if we don't have money how can we celebrate ? And guess what the DOUBLE STANDARD su*kers even have a fireworks at the end of the celebration. Nice way to go green.Long live mindtree , GO kiss the world.
MindIt Replied to: anamika
- 06 Aug, 2009
55:
Hey Sanjibita, i know what business you are offering all of them here. Its Amways business, which make people grow rich in their dreams.
Note to Software engineerrs of so called great comapny called MindTree. You must be knowing a fact that, your company is speanding only 4 crores for the celebrations of its 10th year anniversary. Go stop this and get your roti, kappda aur makkan.. Stop arguing here..
It is the time to ACT and REACT
Note to Software engineerrs of so called great comapny called MindTree. You must be knowing a fact that, your company is speanding only 4 crores for the celebrations of its 10th year anniversary. Go stop this and get your roti, kappda aur makkan.. Stop arguing here..
It is the time to ACT and REACT
anamika Replied to: Sanjibita
- 06 Aug, 2009
56:
Jonathan,
I think sanjiibita dont deserve even that job. Because sanjiibita will start his old tune there also. Every cusotmer will get this repeated statement of Sanjiibita. I think is this is sanjibita's online businees to write something and make money. Right sanjibita. Hello Sanjibita can you commnet with your old statment on this?
I think sanjiibita dont deserve even that job. Because sanjiibita will start his old tune there also. Every cusotmer will get this repeated statement of Sanjiibita. I think is this is sanjibita's online businees to write something and make money. Right sanjibita. Hello Sanjibita can you commnet with your old statment on this?
shripad Replied to: Jonathan
- 06 Aug, 2009
59:
Read jonathan's reply to Sanjibita.
pradipjuly Replied to: Shripad
- 06 Aug, 2009
60:
I am thinking of opening a tea shop on the pyre at burning ghat. Will Mr. Sanjiibita be any help?
Jonathan Replied to: Sanjibita
- 06 Aug, 2009
61:
sanjibita, would you please stop copy & paste same lines again and again.
its better you could let everyone here know what is that business you are talking about?
Thanks, Sunil.
its better you could let everyone here know what is that business you are talking about?
Thanks, Sunil.
sunil Replied to: Sanjibita
- 06 Aug, 2009
62:
why the hell r u soliciting here? can't you see ppl r trying to have a meaningful dialog? go and sell ur wares elsewhere. Shameless creature
Irfan Replied to: Sanjibita
- 06 Aug, 2009
63:
sanjibita,
Are you really serious about the discussion that is going on here or just trying to promote your business opportunity.
I have observed that you have replied to each and every comment with the same sentences. If you really wish to help people, can you expalin the nature of the part time job that you are talking about. It would not be a wonder if i too get a same reply from you and offer me the job opportunity.
Are you really serious about the discussion that is going on here or just trying to promote your business opportunity.
I have observed that you have replied to each and every comment with the same sentences. If you really wish to help people, can you expalin the nature of the part time job that you are talking about. It would not be a wonder if i too get a same reply from you and offer me the job opportunity.
Shripad Replied to: Sanjibita
- 05 Aug, 2009
Beautiful and dress selection, please go to Dresses
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