Fewer employees left the top four Indian software companies in the quarter ended December 31, 2011.
In other words the top four companies, including Tata Consultancy Services and Infosys, saw a drop in employee attrition during the quarter.
Attrition in the industry reduced after a spate of lateral hiring (those hired from other companies) in 2010. This has been contained in the last couple of quarters, said Mr Siddharth Pai, partner with Information Services Group.
Wipro witnessed a sharp decline in its employee attrition to 14.2 per cent – this means for every 100 people only 14.2 left the company. It was 21.7 per cent in same quarter a year ago.
“We have reduced attrition by about 9 per cent in the last two quarters to 14.2 per cent, which was the lowest in the last eight quarters. This is a reflection of the fact that employees have embraced a new direction, and our engaging measures are making a difference,” Mr T. K. Kurien, CEO of Wipro's IT business, in a conference call with analysts said.
According to Mr E. Balaji, CEO, Ma Foi Randstad, a recruitment company, two factors attributed to the decline in attrition. The first was the prevailing pessimistic macro-economic outlook, which makes people more risk averse. Employees would like to retain their existing jobs and big brands give them a safety feeling.
The second factor was that October-December is a festival and holiday season both in India and in the western world. For nearly two weeks in December offices are shut in most parts of the western markets. Hence, hiring takes a backseat.
“Our IT companies earn almost 90 per cent of revenues from the western world, so they go slow in hiring this quarter,” he said.
According to Mr Pai, the IT industry was expecting a significant return to growth and realised that they were lacking strength in the appropriate middle management cadres to manage the new (anticipated) growth.
They began to outdo each other in the salaries paid to new middle management hires in an attempt to fill up the ranks. This created a ‘revolving door' effect for a while, which slowed once the industry began to realise they were ‘poaching' from the same pool.
“At HCL, we believe our talent is our greatest asset and advantage irrespective of the business conditions,” Mr Ravi Shankar, Senior Vice-President, HR, HCL Technologies.
“We are always looking for ways and means to further enhance our value proposition to prospective and existing employees,” he said.
The focus on employees comes from the top and is found to percolate down to all levels of the organisation. ‘Employees First' – HCL's unique management philosophy – is the cornerstone for HR policies and activities.
The Employees First philosophy is not just stated, but is driven by the CEO and senior management, with various aspects featuring on their scorecards, he said.