11000 employees resigned from top Indian companies in the last 90 days

Due to the impact of COVID, 11000 employees resigned from top Indian companies in the last 90 days. This is the first in recent times when the employee count of these top companies reduce drastically

11,000 employees resigned from top Indian companies in the last 90 days

Although, these companies are hopeful of hiring in the upcoming days

In the April-June quarter, India’s largest software company TCS lost 4786 employees. In the same quarter, 3138 employees resign from Infosys. While the numbers at Wipro and Tech Mahindra are at 1082 and 1820 respectively.

A cumulative of around 11,000 employees resign from all these companies. Mr.Pravin Rao, the COO of Infosys says that currently the company has stopped hiring but it already has recruited around 5000 laterals around the world.

All these new recruits are onboarded remotely. Infosys also says there are plans to bring around 20,000 freshers this year.

Meanwhile, at Wipro, CFO says that the company has enough talent for its projects. He also says that the company always looks for revenue and if there is a need to hire new talent, the company is going to hire

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SBI plans to adopt work from home model and save 1000 crore

The corona pandemic has changed a lot about the working model in the country. Almost all the firms are adapting new work models in order to cope up with it. Recently, SBI says it has plans to adopt work from home model and save 1000 crore

SBI plans to adopt work from home model and save 1000 crore

The SBO chairman, Mr. Rajnish Kumar says that by adopting work from anywhere policy, the company is going to save about 1000 crore. This is in the form of cost-cutting and will help run the business in these times

He further adds that the bank is in a good position to tackle the challenges of coronavirus. During the video conference of the annual shareholder’s meeting, he says that SBI aims to focus on the reskilling of the workforce.

He also emphasizes the idea of moving the workforce from administrative roles to sales. He says that the bank wants to implement the Work-from-anywhere policy to improve the work-life balance of its employees.

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Also, he reiterates the idea of taking proactive measures to help the borrowers and maintain asset quality.

SBI also has plans ready to double the number of users of its YONO app in the next six months. Several new features are being added to the app.

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Increase in expenses during WFH: TCS

Contrary to cost-saving, TCS has observed an increase in expenses during WFH. Tata Sons chairman, N Chandrasekaran said that this is due to the long term lease contracts that were signed with the buildings.

He also added that in the current situation it is all expenses for the TCS rather than income. This was announced during the annual general meeting. It was the first virtual gathering of all the stakeholders by any Indian corporation.

Increase in expenses during WFH

The TCS spokesperson also added that this new work arrangement is not a stop-gap response to the COVID by TCS. TCS observes the current trend and takes the decision accordingly. It is also making significant new investments.

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Chandrasekharan also said that TCS does not have any plans for acquisitions this year. This is related to the questions asked about the cash-heavy reserves of TCS. He also added that TCS observes the acquisition situation carefully. Though they have high cash reserves they tend to be more disciplined in these situations.

Instead, they are looking to improve existing businesses across various segments rather than acquiring new ones.

CEO of TCS, Mr. Rajesh Gopinathan said that since FY2016 the company has created unprecedented revenue for its stakeholders. In the last 5 years, the company has paid its stakeholder’s Rs.112,422 crores in terms of dividends and buybacks.

TCS is proud of this achievement due to no other Indian company achieving this mark. TCS has declared a dividend of Rs.6 per share taking its overall equity share to Rs.73 in this financial year. This includes special dividends as well. This year, the total payout was at Rs.31,895 crores.

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Over the past few years, these Indian IT firms have benefitted by hiring fewer people

The top IT services providers in the country have hired fewer people over the past few years in comparison to their revenue growth across the same timeline. This indicates that companies are adopting various automation and digital technologies.

Companies like TCS, Infosys, Tech Mahindra, HCL Technologies, Wipro have increased their growth over the past few years. This has been achieved by adopting the artificial intelligence technologies, automation of tools and digital services

During the same period, the businesses of core services like application development, maintenance, and infrastructure have fallen. Analysts are saying that this can be due to using automation and other technologies for the tasks which are at the bottom of the pyramid.

India’s largest software service provider, TCS currently employs 4,48,464 employees and has seen a compounded growth of 7% in hiring. In relation, the company’s revenue has grown by 10.64% every year. Meanwhile, Infosys’s revenue growth is slightly higher than TCS at 11.23% since the financial year 2015. The company has seen an increase in hiring by 6.59% for the past 5 years

The highest disparity between revenue and hiring among the top IT service providers in the country is observed at TechMahindra with revenue growth at 10.26% and hiring is at 4% each year since FY15

Since the FY15, Wipro has seen a 3% increase in hiring every year, and the revenue of the company has grown by 5.38% for the same period. HCL is the one that has performed well in terms of revenue for the last 5 financial years. The company’s revenue has been increased by 13.77% while the hiring has seen an increase of 7.23%. In the last five years, the company has recruited around 47,000 employees which increase the overall employee count to 150,423

However, at Tech Mahindra there has been a great difference between revenue and hiring for the last 5 years. The revenue of Tech Mahindra grew at 10.26% while new employees are recruited at a rate of 4% each year. Analysts predict that this great disparity at Tech Mahindra is due to the increased number of subcontractor staff deployed in every project.

Last week during the filing to the US Securities and Exchange Commission, Infosys announced that the use of automation tools and related technologies have cut down the costs for the company. Also, this has led to the involvement of manual effort in the projects.

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Sensational! 25% of its employees might be allowed to work from home till 2021 by Tech Mahindra.

On Monday, Tech Mahindra announced that it is in discussions with its clients to allow 25-30% of its employees to continue to Work from home. This could be at least until the end of this fiscal year. Mr. Manoj, the CFO of the company has also said the company is building a new command control system to track the productivity of the employees and the revenue of the company. This new application is already in its beta stage and is currently used by the company, he added.

He further said that the company can easily accommodate 25-30% of its employees to continue working from home in this current financial year. Even the customers are also encouraging the employees to work from home. He also added that the company is working with its clients to create an effective model to allow its employees to work from home. This could easily take 1-2 quarters to finally have a feasible model.

He also said that the main intention is to get to know what is happening in work from home or work from client and collectively track the income and productivity.

Tech Mahindra currently has around 94% of its total 125,000 employees working from home due to the lockdown imposed by the government. The CFO also mentioned that the main reason to have a command control system is to make the quality management system completely online and real-time rather than relying on the manuals and documents. He said, however, the company has to consider privacy issues while working from home.

While having the post-earnings conference call with their analysts, the company is looking at various strategies to reduce costs. Some are to allow its employees to work from home, and reduce the subcontractors’ cost, etc. The company also currently has put a pause on the bonuses.

The company is eagerly looking forward to implementing this model with the benefits that are clearly being seen such as the costs have been dropped to 3% of the overall revenue to 16% previously before the lockdown, in previous quarters.

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Salaries are cut and increments are canceled by Tech Mahindra. But jobs are safe

One of India’s biggest IT service provider Tech Mahindra has released a statement saying that due to the corona lockdown all the promotions and bonuses are put on hold for now. This is due to the lack of revenue since the start of the lockdown. TechMahindra has reported a huge loss of 29% in revenue.

On the brighter side, Tech Mahindra has confirmed that no employee will be fired for now.

Yesterday, while announcing the financial results of the quarter, Tech Mahindra CEO has confirmed the same by saying they are canceling all the bonuses, hikes, and increments for this quarter. This is applicable to all employees of Tech Mahindra.

For senior and mid-level employees, there were undisclosed salary cuts. But for junior-level employees there were no salary cuts planned, Tech Mahindra CEO has confirmed. The situation for now at Tech Mahindra is that no employee is going to be fired. But in the future, depending on the revenue and number of projects at hand, some employees might be asked to leave the organization.

Tech Mahindra CEO has added that unless there is a situation where a complete line of business will be closed, there won’t be any firing of the employees.

Around 90% of the Tech Mahindra employees are currently working from home. The CEO while announcing the quarter results has described that this is a tough period for the company. The company has reportedly lost 29% of the consolidated profits in this quarter. Currently, there are around 1,25,236 employees working in Tech Mahindra which is 4.3% less than the previous quarter.

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Lowest in the decade. IT companies might record their lowest revenue in this decade

Various factors like cutting down on discretionary spending and slowing down on demand could cost the revenue of IT companies to a greater extent. With the current situation being bad many IT companies like Infosys, Wipro have said that they will not be providing revenue growth guidance for the financial year 2021 and the June quarter. Along with these companies, Cognizant also refrained itself from revenue growth guidance for the full year.

The revenue pressure will be high on the IT company for the year 2020-21, according to a rating agency Crisil. This could be due to Covid-19. The growth could be very low, around 0-2% which is way less than in the 2018 fiscal year. This analysis is done on the largest 15 firms which contribute to the 70% revenue of the sector.

Analysts predict that this COVID slowdown will have a huge impact on various sectors and across different industries. Emkay Research has said that even though there is no blow-up yet for any organization, the disruptions across various verticals could result in a huge loss for the Indian IT companies.

TCS CEO and Wipro CEO recently had said that due to this COVID, there could be price re-negotiations between the companies and the clients. Typically, the deals between companies and the client most probably happen between March and May. But this time, during that period the clients are focused on cutting the emerging business risks and defer the discretionary IT spend. Analysts also said that for certain areas in IT such as cloud, virtualization, etc the demand had increased post lockdown. Several experts and top VPs of various companies believe that any product which helps the client to move their work more towards remote will be of huge demand.

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52% of CEOs expect job losses: CII Snap Poll

With the widespread of the COVID19, the country’s economy has been hit very hard. Most of the firms have seen revenue declining, and job losses as well according to a CII CEOs Snap Poll.

Around 200 CEOs have participated in this survey. According to the survey, most of the firms are expecting a loss of more than 10% revenue this year due to the corona spread. Some are expecting their profits to decline by about 5%.

Firms feel that this decline in the revenues and profits may have a huge impact on the GDP of the country. In other results of the survey, around 52% of the firms feel that they might lose jobs this year. Around 47% of the firms are expecting 15% job losses. 32% of firms expect 15-30% job losses.

The survey also told that 80% of the firms are having their inventory idle at their warehouses. Half of these, 40% of the firms expect that their inventory will last for more than a month once the lockdown is over. They are expecting a low demand scenario after the lockdown.

The majority of the firms participating in the production of necessary goods are having a difficult situation to supply, due to the lockdown. They feel that manpower access and movement of products has been the biggest challenge during this lockdown.

Even though the government has allowed the manufacturing of necessary products, the scarcity of workers at the local level has become a challenge.

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