Tech Mahindra sees sharp fall in headcount
Decline of 5,000 mainly due to change in client technology requirement, says firm
Tech Mahindra, India’s fifth-largest information technology services company, has reduced its employees by around 5,000 last year. The company has attributed it to a shift in client technology requirements in a short duration.
The company, however, has started stepping up hiring. It has hired around 1,700 employees in the last two months.
"With the current technological availability, we are looking at exponential growth in revenue per employee. In the past six months, we have seen a huge change in the technology requirements. Customers also want automation for greater efficiency and consistency of results," Harshvendra Soin, newly appointed chief people officer of Tech Mahindra told Business Standard. The company was seeing demand for technologies in the areas such as artificial intelligence, blockchain and augmented reality over the past year, he added.
In FY18, Tech Mahindra’s headcount (excluding business process outsourcing) reduced by 9,966 even though in the preceding financial year, the company had added a little over 10,000 software professionals to its workforce. Between the fourth quarter of FY17 and the first quarter of FY18, the software headcount dropped by 3,407. This was also a period when Tech Mahindra was plagued by multiple allegations of layoffs from their offices across the country, prompting many disgruntled employees to turn to the Labour Commission.
But the company said it would continue to hire people as they see a need for talent across domains. "We have added about 1,700 people on a net basis over the past two months. It means we are seeking talent to supplement our growth and we believe we will attract a lot of good talent across industries," Soin said. People who skill themselves in new-age technologies and agile processes have a lot to gain, he quickly adds.
Last year, Tech Mahindra issued wage hikes only for employees with up to six years of experience. This year, the company has announced effecting compensation hike over the first two quarters, which is expected affect its profit margins negatively. However, it plans to mitigate the impact with increased automation and an optimal mix of offshoring, outsourcing and near-shoring this year. The company, however, had declined to spell out the amount of hikes it plans offering this year. Most of its peers have already announced to offer a salary hike of up to 6 per cent to their offshore employees.
"We are continuously investing in the right people and technology. We have already reskilled roughly 70 per cent of our employee base. Now, hiring is more around newage technology, which is the company strategy," Soin said.