Software services firm Tech Mahindra has sacked a thousand-odd employees this month, following moves by Wipro, Infosys, and Cognizant to trim workforce amid the worst business crisis in nearly a decade.
Indian information technology (IT) firms are witnessing their slowest growth in a decade due to automation, technology shifts, and increased protectionism in its main markets. Global firms are shifting their budgets from traditional IT services to newer areas such as digital and cloud, which require engineers to engage with clients than work remotely. Also, low-end maintenance work is getting increasingly automated, forcing companies
to shift workers to other projects and reduce hiring from campuses.
With growing stress on their businesses, IT firms are also increasing scrutiny on employees and weeding out non-performers.
“We have a process of weeding out bottom performers every year and this year is no different,” a Tech Mahindra spokesperson said.
As on December 31, 2016, the company’s total employee headcount stood at 117,095, while the software division had 80,858 employees.
Industry experts say mid-level employees with 10-15 years of experience may be largely affected as many are averse to learning new skills.
More software services firms struggle to deal with challenges such as slow-paced growth in business, changing client demand with more outcome-based business, and immigration issues across different markets including the US.
Bengaluru-based Wipro said it “undertakes a rigorous performance appraisal process on a regular basis to align its workforce” and continued it this year. The company, however, did not specify the exact number of affected employees.
Infosys is in the process of tightening performance metrics and 1,000 people may have been impacted after the bi-annual assessment.
Infosys said it has taken up a similar exercise for mid-level professionals to scrutinise their performance amid shift to automation and software-led services. “A continued low feedback on performance could lead to action, including separating an individual,” said the company in a statement.