TCS' plan to weather storms without layoffs

BENGALURU: Tata Consultancy Services has a number of ways to respond to a slowdown in business, even as it prepares for stronger growth, the company’s human resources head told ET.While Indian IT companies are predicting strong growth this year, the prospect of an economic slowdown in the US remains and Britain crashing out of the European Union without a deal could hurt growth in that region. TCS has said it is continuing to prepare for strong growth, but that it has maintained operational discipline to weather a downturn and that some levers to reduce costs could be used immediately.“If suddenly there’s a recession, then there will be certain projects that get terminated or come to a closure; new projects will not start.So, there will be movement from onsite to offshore. That doesn’t mean that somebody loses his/ her job, but the cost comes down,” Ajoyendra Mukherjee, chief human resources officer at TCS, told ET.He said the company would also be able to cut costs in travel and, in case of performance-related issues, could look at cutting time for an employee to turn around. “Today maybe, you are giving an opportunity for someone to improve performance for a much longer period, but that period would come down,” said Mukherjee.The Indian IT industry has weathered a slowdown before. And unlike in the past, is better able to deal with a shift in demand. The IT sector no longer hires tens of thousands of freshers from engineering colleges, with hiring patterns having shifted to a few freshers and just-in-time hiring for experienced workers. The companies also no longer possess a large bench and utilisation is over 80% at most of the big companies.TCS said that it had always honoured the commitments it had made to freshers and would use a downturn to increase training. “Earlier training used to get over in three months; we extended that duration. Instead of training in one or two specific technologies, we trained them for a longer period, more hands-on. So the moment demand picks up, they are ready to deploy. So that’s what we will do. It will have certain impact on our business from the profitability angle, but that’s a call that we have to take,” Mukherjee said. “In our heart, we don’t want to go about firing people – that’s the last resort.”

from Economic Times http://bit.ly/2UpCe15
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