Information technology companies are cutting back aggressively on bench strength, even targeting zero bench, as profit margins tumble , according to Rahul Patwardhan, CEO, NIIT Ltd.

Bench strength in IT companies refers to a reserve of skilled workforce kept on standby.

Automation and use of bots are replacing repetitive manual tasks but many companies still have people who have competency in dealing with legacy systems. This is affecting fresh hiring and increasingly ‘structural layoffs under the garb of performance-based layoffs,” he told media persons.

While companies are trying to re-skill their employees to handle projects based on new technologies like digital, non-availability of expert trainers and training firms is affecting them, he said.

New combination

New business models are emerging using combination of automation, crowd sourcing, ‘platformation’ and a major shift away from custom software and process to cloud-based Software-as-a-Service and Business process-as-a-Service. The entire business model of application management service providers itself is under threat, he said.

Companies are finding it difficult to find adequate supply of fresh talent with new skills as most of the engineering colleges teach older curriculum that is becoming redundant fast. Companies need to invest heavily to retain fresh graduates.“We are trying to address both these problems through our products,” he said.

NIIT, a skill development company, has launched three new products — StackRoute online for mass re-skilling of existing employees, DigiNXT NIC (NIIT Insider College) to help colleges and undergraduate students get themselves skilled and Training.com and NIIT.tv retail online platform for the retail segment.

“We are ready with full fledged solutions for the IT industry, help colleges teach their students on latest technologies and help retail segment learn IT,” he said.

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