Deloitte to Hire 15000 In India

Global business consultancy Deloitte is planning to hire 15,000 people in the country over the next two to three years, the company's top official said here Tuesday.

"We are very upbeat about the Indian economy and have major expansion plans in India," said Deloitte's global chief executive Jim Quigley.

"At present, we are employing about 11,000 people in India. To increase our business, we are planning increase it by 15,000 people over the next two to three years," Quigley told reporters.

"The (global economic) crisis is also an opportunity to expand and acquire assets at attractive valuations. We believe that India and China will be leading the global economic recovery. Europe will very slow to recover. So it makes sense to invest here," he added.

"Even during the time of economic slowdown we saw a (business) growth of 30 percent in India. We are going for active acquisition and expansion plans here."

Entry Level Salaries Down by 20% in IT

Entry-level salaries down by 20% for software pros

Dhannanjay Kumar, a 25-year-old computer science graduate from a top engineering college in Bangalore, considers himself lucky to have found job in a year when India’s over $50-billion software outsourcing industry had to cope with falling demand and trim payroll by up to 10%.

“Not only I had to work twice as much for getting an interview, the annual salary of around Rs 1.7 lakh is much lower compared to my seniors who got Rs 3.5 lakh two years ago,” said Kumar who got hired by a Bangalore-based mid-tier software company last month.

Every year, around 3,00,000 computer science and engineering graduates seek employment with hundreds of tech firms, including big names such as TCS, Infosys and Wipro. This year, more than half of them were left unemployed because tech firms were already finding it tough to manage resources sitting on the bench.

A worsening economic crisis, increased availability of skilled workers and lower demand for software services have brought down the entry-level salaries for IT professionals in the country by up to 20%, according to experts tracking the sector.

“The entry-level salaries are down by at least 10-16%,” said GC Jayaprakash, principal consultant of Stanton Chase International.

Until two years ago, almost all computer and engineering graduates were absorbed by India’s outsourcing industry, comprising top tech firms such as TCS, Infosys, Wipro and many others. However, as customers delayed and shelved outsourcing projects, these tech firms also postponed campus hirings.

“Last year, a number of companies gave away offer letters but did not recruit. On top of that, there is a new pool of qualified professionals being churned out this year -- all this has created an oversupply in the entry-level IT job market where salaries typically sway between Rs 3 lakh per annum and Rs 5 lakh on the higher side,” Mr Jayaprakash added.

Many students had to approach potential employers directly, since companies did not visit their campuses for placements.

“We formed groups and toured companies, and agreed to settle at lower salaries because it’s better to be employed at lower salary than having no job at all,” said Srilekha Varma, who recently accepted a job offer from a Chennai-based IT firm specialising in banking software.

Recruitment firms such as GlobalHunt said the entry-level salaries may have dipped by up to 30% because of increased availability of skilled professionals.

“Earlier, companies were building bench strength and doing skill development, as they were expecting large business and didn’t want to run out of manpower. Fresh graduates used to have multiple offers and they were in a position to negotiate,” said Sunil Goel, director of GlobulHunt’s Indian operations.

In a normal year, computer science graduates were offered entry-level salaries of Rs 3.5-5 lakh. However, companies are now hiring freshers at Rs 1.7 to Rs 3.5 lakh.

Meanwhile, HR heads at tech firms, including Wipro, India’s third-largest software exporter, say professionals have become more realistic about what they want from their employers.

“I don’t think salaries have come down, but the environment has indeed helped us in containing salary hikes,” Pratik Kumar, head of human resources at Wipro said.

What has also changed this year is the manner in which salary offers are being structured.

“Due to an oversupply of qualified talent there is rationalisation at entry-level salary, which is based more on performance and are variable by nature. Cost-to-company is not necessarily a comparison of the past-drawn salary,” said Ashok Reddy, managing director and co-founder of staffing company TeamLease.

Indeed, professionals who lost their jobs during the past few months, are now being offered entry-level salaries by companies who can get experienced talent at lower salary levels.

“I was working as a software testing engineer and lost my job in February. Now I have a job, but the salary is similar to what is being offered to new recruits,” said Neelesh, who has around six-month experience.

“Companies are now preferring to hire professionals who missed jobs due to slowdown, were on the bench or were laid off, because they have some kind of training and are experience compared to freshers,” said Mr Goel.

TCS said it would do new campus hiring in January 2010 and will honour all 24,000 offers made for FY09. “Around 1,800 graduates have joined us in Q2 and another 8,000 will join in Q3, rest of the graduates will join based on the demand,” a TCS spokeswoman said.

Infosys said for FY10, it has made 20,000 campus offers and expects an 80% conversion rate i.e. 16,000 of these offers to join the company. “We are honouring all our hiring commitments,” an Infosys spokeswoman said.

Aricent, Sapient to Hire

Bangalore: Aricent, a global innovation, technology and services company, and Sapient, a business and IT consulting firm are planning to hire around 1500 professionals in the next three to nine months. While Sapient will hire around 800 professionals, Aricent plans to hire at least 700.



Mid-tier and niche technology companies are returning to the employment orbit as they plan to take in 25,000 to 30,000 experienced hands in the next three to nine months, reports Economic Times. The renewed demand has been spurred by a spurt in outsourcing, better order positions and companies expanding their India operations and moving up the value chain. Other companies on the lookout for trained hands are GlobalLogic India, MindTree, CPA Global, Symphony Services, Citrix, Adobe, Persistent Solutions, nVidia, Amazon, Agilent and Vertex.

"Customers are stretching their dollars, and outsourcing helps them do that. That's what's driving demand for fresh talent at present," says Prashant Bhatnagar, Director-hiring, Sapient. "Lateral hiring is back and there's plenty of demand for those with three to eight years experience," adds Rishi Das, CEO, CareerNet Consulting, a Bangalore-based headhunter which recruits for over 200 technology companies.

Many companies which are now hiring, had no bench staff or have increased their utilization and hence now need more staff as more work is being offshored. "It's like a food chain. Mid-level companies which have invested in niche skills and started with basic tasks like technology support are now capable of delivering complex work like product design," says another Mumbai-based Head Hunter, who did not wish to be named due to client sensitivity.

"Offshoring complex work helps global customers cut costs significantly. That's driving the current demand for experienced professionals."

Companies like Applied Materials, Volvo, Boeing, Bank of America, Amazon, the United Health Group and Societe Generale have farmed out work for new enterprise applications development, R&D, engineering services and professional services - like customised software development - among others, driving demand.

Wipro ties up with oracle for co development

Indian IT services giant Wipro Technologies has entered into a master co-development agreement with Oracle to develop multiple industry solutions using Oracle Application Integration Architecture (AIA) - an open, standards-based platform for business process integration across Oracle, third-party and custom applications.

Under the arrangement, both partners will co-develop end-to-end industry process solutions for five different industry verticals, including communication, retail, consumer products, hi-tech, and industrial manufacturing.

Reports revealed that co-developed Oracle Process Integration Packs include campaign to cash for hi-tech, order to activate for communications and design to release for process manufacturing.

The scrip of Wipro Limited closed on Friday at Rs 567 on BSE. The counter has made 52-week-high and low of Rs 583 an Rs 182 respectively. (dpa)

Cheer Up!! Hiring and Salary Hikes are Back

Bangalore: Many were predicting six months back that the Indian IT industry would be entering its twilight zone, but now there are indications that these predictions may go wrong. Several IT companies have restarted hiring and are giving salary hikes to their employees.



"That phase of drastic downturn is behind us," says S Ramadorai, CEO of Tata Consultancy Services (TCS). "There's stability now. The deal pipeline is encouraging, but the time it takes to close a deal remains long. And many customers are yet to fully open up their IT budgets," Ramadorai added.

While IT majors like TCS, Wipro and Cognizant have started promotions and salary hikes, Kris Gopalakrishnan, CEO and Managing Director of Infosys feels that things are looking better now, however the company prefers to wait and watch before giving any promotions or hikes, reports The Economic Times.

The recovery of the defamed Satyam Computer Services under the new owner Mahindra Satyam has also proved to be a boon for nearly 28,000 employees across all levels, with the restoration of the variable pay. The variable component is 10 percent at the entry level, 20 percent at the middle level and 30 percent at the senior management level. IT bellwether Wipro has lifted its freeze on hikes and promotions, at least for some employees.

Manpower supply company TeamLease, which saw its open positions drop significantly from 10,000 a month to 800 post-recession, has in the past couple of months seen those numbers rise to 3,500.

With the current trend companies have also started showing more confidence in the Indian market. Information infrastructure company, EMC has announced that it will invest $1.5 billion in India over the next five years, a level of investment from a single company that the sector has not seen in close to two years. Partha Iyengar, Regional Research Director in Gartner India, says the number of calls the company gets from customers for directions and consulting has gone up sharply in the last 3-4 months.

The Indian IT industry was one of the worst hit by the recession on account of its dependence on international markets - especially the U.S. and European markets. The freeze on IT budgets by companies around the world meant that new orders dried up. Industry association Nasscom initially forecast that IT exports would grow by 22-24 percent in 2008-09, but as the recession deepened, this was revised down to 16 percent. For this fiscal, the association has projected a 4-7 percent growth to $48-50 billion.

TCS, Wipro, Infy win 1.5 Billion Contract

TCS, Infosys, Wipro win $1.5 billion outsourcing contract
With this, BP has reduced the number of its technology vendors from 40 to five and expects to save as much as $500 million over the next five years

Bangalore: India’s top three technology firms—Tata Consultancy Services Ltd (TCS), Infosys Technologies Ltd and Wipro Ltd—have each won part of a five-year software outsourcing contract valued at around $1.5 billion (Rs7,320 crore) from British oil and gas firm BP Plc.

IBM Corp. and Accenture Ltd are the other vendors.

With this, BP has reduced the number of its technology vendors from 40 to five and expects to save as much as $500 million over the next five years, a company spokesman said.

“Over the last 12 months, we undertook an effort to consolidate our technology vendor base and eliminated 35 of them. These five were selected for scale and ability to support us from around the world,” BP’s spokesman David Nicholas said over the phone from London. “Otherwise, with 40 vendors, we would have spent $2 billion.”

He declined to specify individual contract values.

IBM said in a statement it has won the largest pie of the contract to manage and run all of BP’s enterprise applications and service desk responsibilities, but did not specify the value. The three Indian vendors, which were part of the earlier line-up of 40 information technology firms, will carry out application development and maintenance work for the British firm.

“The engagement with BP underscores our ability to help global corporations become more competitive in the current economic scenario...,” N. Chandrasekaran, chief operating officer and executive director of TCS, said in a statement.

The Indian vendors may not earn significant revenue from the deal, but it will help them gain expertise in the manufacturing domain in the European market, where they are keen to expand services, said Sabyasachi Prasad, partner with Tholons Inc., an advisory firm for offshore exploration firms.

Europe accounted for around 30% of India’s software exports of $46.3 billion in fiscal 2009. BP’s chief information officer Dana Deasy said in a statement issued by Infosys that the deal would help BP simplify and streamline processes and bring down its overall cost base.

In July, BP said it had already exceeded the $2 billion reduction in cash costs targeted for 2009 and expected a further $1 billion in savings over the rest of the year.

“Our extensive capabilities and experience in oil and gas domain will enable us to deliver significant value to the energy major’s business,” Suresh Vaswani, joint chief executive at Wipro, said in a statement.

TCS to hire 25000

Bangalore: In a move that could bring a smile to many faces, Tata Consultancy Services (TCS) has announced that it will hire 25,000 people globally in 2009, with 90 percent of them in India alone. Though the number is bigger when compared to the hiring these days, it is less than last year when TCS appointed around 35,000 people.

With this recruitment drive, TCS also plans to expand its presence into the tier-II cities in India. "We will be hiring 25,000 people this year, which means roughly 25 lakh square feet of work space required and, therefore, we need to grow outside the metros. Tier-II cities are our only focus for expansion in the country as the top rung are clogged and saturated," said Tanmoy Chakrabarty, Vice-President and Head of Government Industry Solutions unit at TCS.

Following this hiring spree, the total global manpower of TCS would go up to more than 1.8 lakh. This will put the IT services provider among large private Indian employers like Tata Steel, which has the total employee strength of two lakh. Going forward, the company, which has an estimated 32 percent market share, plans to cash in on the Indian government's plan to invest Rs. 40,000 crore on IT services.

Currently, 70 percent of the IT segment's revenue is from India, while the rest comes from the U.S., Latin America, Africa and South East Asian countries. However, the revenue contribution from Indian government businesses to the total company revenue of $6 billion is less than five percent, which the company intends to increase to more than 10 percent in the next three years.

Morgan Stanley Looking at Exiting back office ops in India

Bangalore: U.S. bank Morgan Stanley is exploring the opportunities to exit its back-office operations in India. The bank, which was bailed out by the U.S. government, is looking at its options to sell the back-office unit that does IT development as well as finance and accounting-related work, reports the Economic Times.

Knowledge Process Outsourcing (KPO), equity research, complex financial modeling and portfolio analysis are among the work done here.

According to an investment banker, the potential value of the transaction could be $150-$200 million, in which the KPO operations have a share of $50 million. These operations employ around 2,000 people, of which 500 are KPO employees. Most of the operations are based out of Mumbai and a small part out of Pune.

The value of the deal will also depend on the amount of business the bank will sell. "The annual revenue run rate for Morgan Stanley's captive operations is $70-$80 million. So, the committed business could be around $500 million for five years," said a person with knowledge of the development.

Large Indian IT firms are the expected buyers, some of which already do development work for the bank. These include Infosys, Wipro and KPO firm like eClerx, which works for investment banks, travel and retail industry.

The need to convert fixed costs to variable costs by moving work done at the captive unit to third party vendors is among the factors which drive the sale of many captive units. When the work is outsourced to third party vendors, there is greater flexibility to increase or decrease work without having to hire a fixed number of employees.

Indian IT Companies Skip Campuses

Bangalore: With Nasscom, the software industry's apex body advising its members not to go to campuses for recruitment, the placements at engineering colleges has dried up. However, although 2008-09 was a difficult year for training and placement officers (TPO) at engineering colleges, 2009-10 could be the most critical year for campus placements, reports Economic Times.


JN Pitambare, Dean of Sinhagad Institute says, "Normally, 75-80 percent of the placements used to take place by mid-August. However, this year I will be happy if I am able to place even 10-15 percent of our students by December."

SV Dravid, TPO, DY Patil College of Engineering at Akurdi, near Pune said, "Last year, we had placed 150 students by this time. This year, not a single student has been placed. I hope the situation improves by December." Normally the big software companies finish recruitment by mid-August, placing around 75 percent of the college students.The core sector companies used to come from August, but this year they are non-committal.

Companies have been telling TPOs that their placement requirements are yet to be firmed up since things are not planned yet or they do not know how many projects they will get. "Most of the core companies are in a dilemma. They have promised to come for placements by December," said TPO Federation President Professor Shital Rawandale. Not only are there fewer jobs on offer for 2009-10 but the companies are adopting various techniques to defer the joining dates of candidates recruited last year or even to reject them.

Top colleges like the College of Engineering Pune (COEP) are also facing problems. "Of the 576 students placed last year, only 150 have joined till now. For the rest of them, joining has been deferred from July to December," said Assistant TPO, COEP, SA Meshram.

Some of the selected candidates are being asked to take more tests. With the recession, singing of bonds has also returned. "Some small and medium-sized software companies now want the candidates whom they had already selected to enter into two-year bonds," said a TPO.

In India, Global Crisis Is Not All Bad News

About 60 percent of India’s outsourcing business comes from the United States, and 40 percent of the work is in the banking, insurance and financial services sectors.

“We now have to look at other regions of the world, like Japan, the Middle East and the Nordic countries,” said Som Mittal, president of the National Association of Software and Services Companies, or Nasscom. “The current crisis has sharpened our realization that we cannot put all our eggs in the U.S. basket.”

Perhaps the biggest and most sustaining change has been its climb up the value chain of services in recent years — from back-office support functions to what the industry calls “knowledge process outsourcing,” which includes legal services, hardware network management and engineering design.

One of the country’s biggest technology companies, Bangalore-based Infosys, has been making a deliberate effort to scale back assembly-line software development and ramp up more technically complex services such as engineering design.

“It is a strategic shift we began making some years ago,” said S. Gopalakrishnan, the company’s chief executive officer. “Our efforts to expand our services to include high-end consulting, systems management and product engineering and design work may help weather the storm.”

Infosys’s fastest-growing business is in product and machine design for American aerospace, automobile and construction firms, but the company has also set up consulting businesses in China, the Middle East and Mexico.

Meanwhile, the legal services branch of India’s outsourcing industry is experiencing a boost as a direct result of the global crisis, as bankruptcies, mergers and acquisitions proliferate and demand grows for help with litigation.

China Strategist suggests to Break up India by 2015

Almost coinciding with the 13th round of Sino-Indian border talks (New Delhi [ Images ], August 7-8, 2009), an article (in the Chinese language) has appeared in China captioned 'If China takes a little action, the so-called Great Indian Federation can be broken up' (Zhong Guo Zhan Lue Gang, www.iiss.cn, Chinese, August 8, 2009).

Interestingly, it has been reproduced in several other strategic and military Web sites of the country and by all means, targets the domestic audience. The authoritative host site is located in Beijing [ Images ] and is the new edition of one, which so far represented the China International Institute for Strategic Studies (www.chinaiiss.org).

Claiming that Beijing's 'China-Centric' Asian strategy, provides for splitting India, the writer of the article, Zhan Lue (strategy), has found that New Delhi's corresponding 'India-Centric' policy in Asia, is in reality a 'Hindustan centric' one. Stating that on the other hand 'local centres' exist in several of the country's provinces (excepting for the UP and certain northern regions), Zhan Lue has felt that in the face of such local characteristics, the 'so-called' Indian nation cannot be considered as one having existed in history.

According to the article, if India today relies on any thing for unity, it is the Hindu religion. The partition of the country was based on religion. Stating that today nation states are the main current in the world, it has said that India could only be termed now as a 'Hindu religious state'. Adding that Hinduism is a decadent religion as it allows caste exploitation and is unhelpful to the country's modernisation, it described the Indian government as one in a dilemma with regard to eradication of the caste system as it realises that the process to do away with castes may shake the foundation of the consciousness of the Indian nation.

The writer has argued that in view of the above, China in its own interest and the progress of Asia, should join forces with different nationalities like the Assamese, Tamils, and Kashmiris and support the latter in establishing independent nation-States of their own, out of India. In particular, the ULFA (United Liberation Front of Asom) in Assam, a territory neighboring China, can be helped by China so that Assam realises its national independence.

The article has also felt that for Bangladesh, the biggest threat is from India, which wants to develop a great Indian Federation extending from Afghanistan to Myanmar. India is also targeting China with support to Vietnam's efforts to occupy Nansha (Spratly) group of islands in South China Sea.

Hence the need for China's consolidation of its alliance with Bangladesh, a country with which the US and Japan [ Images ] are also improving their relations to counter China.

It has pointed out that China can give political support to Bangladesh enabling the latter to encourage ethnic Bengalis in India to get rid of Indian control and unite with Bangladesh as one Bengali nation; if the same is not possible, creation of at least another free Bengali nation state as a friendly neighbour of Bangladesh, would be desirable, for the purpose of weakening India's expansion and threat aimed at forming a 'unified South Asia'.

The punch line in the article has been that to split India, China can bring into its fold countries like Pakistan, Nepal and Bhutan, support ULFA in attaining its goal for Assam's independence, back aspirations of Indian nationalities like the Tamils and Nagas, encourage Bangladesh to give a push to the independence of West Bengal [ Images ] and lastly recover the 90,000 sq km territory in southern Tibet [ Images ].

Wishing for India's break-up into 20 to 30 nation-States like in Europe, the article has concluded by saying that if the consciousness of nationalities in India could be aroused, social reforms in South Asia can be achieved, the caste system can be eradicated and the region can march along the road of prosperity.

The Chinese article in question will certainly outrage readers in India. Its suggestion that China can follow a strategy to dismember India, a country always with a tradition of unity in diversity, is atrocious, to say the least. The write-up could not have been published without the permission of the Chinese authorities, but it is sure that Beijing will wash its hands out of this if the matter is taken up with it by New Delhi.

It has generally been seen that China is speaking in two voices -- its diplomatic interlocutors have always shown understanding during their dealings with their Indian counterparts, but its selected media is pouring venom on India in their reporting. Which one to believe is a question confronting the public opinion and even policy makers in India.

In any case, an approach of panic towards such outbursts will be a mistake, but also ignoring them will prove to be costly for India.

D S Rajan, is Director, Chennai Centre for China Studies.

Obama's move to end tax breaks for US firms who outsource

New Delhi: India Inc believes the move by the Barack Obama administration to reduce tax breaks for US firms that ship jobs overseas will hit American companies more than impact on the Indian outsourcing industry.

"It's a more US-US issue rather than one aimed at stopping outsourcing, or off-shoring, or anything to do with India," said Som Mittal, president of the National Association of Software and Service Companies (Nasscom), a representative boddy for the industry.

"If you look at Indian companies operating in the US, or elsewhere, they work there and pay taxes there. Hence, it is not about stopping outsourcing, or off-shoring, but just to collect taxes," Mittal told IANS.

His comments came after President Barack Obama said Monday that the current US tax system gave US-based multinationals that shipped jobs to places like India an unfair advantage over other domestic rivals and wanted corrective steps.

"It's a tax code that says you should pay lower taxes if you create a job in Bangalore, India, than if you create one in Buffalo, New York," Obama said, explaining why he intended to close tax loopholes and crackdown on overseas tax havens.

"I want to see our companies remain the most competitive in the world. But the way to make sure that happens is not to reward our companies for moving jobs off our shores or transferring profits to overseas tax havens."

According to a McKinsey-Nasscom study, the Indian software and outsourcing industry employs some two million people, earning total revenues worth $52 billion, of which nearly $48 billion comes from exports.

The Confederation of Indian Industry also felt that the remarks were more in the nature of posturing and that it was not intended at curbing outsourcing of work by US firms to Indian companies.

"It's an internal issue. It will only reduce their competitiveness," said Hari Bhartia, vice president of the chamber. "It is a populist posture. Perhaps his (Obama's) intention was not the same. However, it sends a wrong message."

According to Girish Vanvari, a tax expert and executive director with accounting and consultancy major KPMG, the Obama administration's move was aimed at keeping American money within the country.

"I don't think this will happen. America is one of the largest free markets in the world - otherwise, you will have companies paying as much as 70 percent of their revenues as taxes," Vanvari told IANS.

Nasscom maintained that large US companies had subsidiaries across the world and that more than 50 percent of their revenues were coming from outside the US. The US move was to ensure that the large profits kept outside are also brought into the tax net.

"President Obama is intending to collect those taxes to create more jobs in US," said the industry lobby that sent a delegation to the US last month to meet lawmakers, urging them to refrain from protectionist measures.

Infosys Technologies, India's second largest software and outsourcing company, also felt that the US proposal was aimed at closing corporate tax loopholes and crack down on overseas tax havens.

"We do not believe that it has anything to do with IT outsourcing done by US corporations," a spokesperson for the company said.

Indian IT Professionals Upset with Obama

Bangalore: Indian IT professionals Tuesday slammed President Barack Obama's move to end tax incentives for US companies that ship jobs to countries like India, saying it will neither benefit the U.S. nor its corporate sector."Obama's latest move was expected, but unwelcome at a time when Bangalore's IT and BPO sectors are already reeling under the global economic meltdown," said Padma Nair, 26, an IT-professional working for a Bangalore-based American company.

"Obama's new policy is not going to benefit anyone, neither the outsourcing companies nor the country the job is outsourced to. The cost saved in outsourcing is higher than that saved by tax exemption," Nair told IANS.Expressing a similar view, Shankar Banerjee, 25, a quality analyst working for another American IT company, said if Obama's proposal is pushed through, it will hit business coming India's way and many Indians would lose their jobs."IT and BPO companies in India have already suffered due to the slowdown. A lot of people have lost jobs. Obama's latest move will cause more problems," added Banerjee.

The comments came after President Obama said Monday that the current US tax system gave US-based multinationals that shipped jobs to places like India an unfair advantage over other domestic rivals and wanted corrective steps."It's a tax code that says you should pay lower taxes if you create a job in Bangalore, India, than if you create one in Buffalo, New York," Obama said, explaining why he intended to close tax loopholes and crackdown on overseas tax havens."I want to see our companies remain the most competitive in the world. But the way to make sure that happens is not to reward our companies for moving jobs off our shores or transferring profits to overseas tax havens."

According to the National Association of Software and Services Companies (Nasscom), the US accounts for about 60 percent of India's software services export revenue. Bangalore-based firms account for one-third of this.A recent study by the association, conducted along with McKinsey, shows the Indian software and outsourcing industry employs some two million people, earning total revenues worth $52 billion, of which nearly $48 billion comes from exports.

American IT companies that have set up offices in Bangalore include Accenture, Microsoft, Amazon, AOL, Cisco, Dell, IBM and Intel.An estimated 600,000 people are employed in Bangalore's software and outsourcing sectors. And industry professionals say many could lose their jobs following Obama's latest move.

UNITES-Professionals India, a trade union for IT enabled services sector, predicts 50,000 employees in India will be handed the pink slip over the next few months. Bangalore, hailed as India's Silicon Valley, could be the worst affected.Concurred Sumana Prasad, 32, an IT employee working for an Indian company: "The slowdown has already hit Bangalore's IT and BPO companies. Obama's latest step will affect more people."

Obama Cuts Cost to Face India, China

Washington: President Barack Obama wants to reduce health care and energy costs to lessen the massive national debt lest India and China overtake a recession hit US economy."We're doing everything we can to reduce that deficit," Obama said addressing his second prime time news conference Tuesday night.

A fiscal deficit of over $1.3 trillion left by the Bush administration is expected to double with the stimulus measures to rescue the economy.

But it's hard to do so "because we've accumulated a structural deficit that's going to take a long time, and we're not going to be able to do it next year or the year after or three years from now. What we have to do is bend the curve on these deficit projections," Obama said."And the best way for us to do that is to reduce health care costs," he said suggesting investment in health information technologies and preventive care. "Let's do a whole host of things, some of which cost money on the front end, but offer the prospect of reducing costs on the back end."

Now, the alternative is to stand pat and to simply say: We are just going to not invest in health care. We're not going to take on energy. We'll wait until the next time that gas gets to $4 a gallon. We will not improve our schools."And we'll allow China or India or other countries to lap our young people in terms of their performance. We will settle on lower growth rates, and we will continue to contract, both as an economy and our ability to provide a better life for our kids,"

Obama said.Asked about a Chinese proposal to replace the US dollar as the reserve currency with a new global currency run with a different standard by the International Monetary Fund, he said: "I don't believe that there's a need for a global currency.""The dollar is extraordinarily strong right now," Obama said, "and the reason the dollar is strong right now is because investors consider the United States the strongest economy in the world with the most stable political system in the world."

Wipro Join BPO

India’s third largest software exporter Wipro is asking its latest batch of recruits from engineering colleges if they want to join its business process outsourcing (BPO) division instead of the technology services unit for which they were originally hired.

Wipro said it is offering the option because it sees delays in the joining dates for some batches of recruits due to the ‘current business environment.’ According to sources, the students have been given the option of working in the BPO division for a year and later they could be shifted to the IT services vertical. The salary from the original offer remains unchanged.

At the end of September, Wipro employed nearly 62,000 staff in its IT services business and about 21,000 in the BPO division. It also makes strategic sense for Wipro to recruit the new engineering graduates in the BPO unit as this vertical regularly witnesses higher attrition rates than the IT services division.

So friend kindly don’t accept this offer by Wipro. In some district of Tamil Nadu students and there parents filed a case in court and and the engineering students of that district go the joining date within one week. So, I kindly ask you all to fight for this,this your dream and you all have rigths for doing it so. Since you got this offer I hope your waiting for joining date and have not tried anything outside ,so fight for dreams.

Wipro 445 Layoffs

As part of their annual HR exercise Wipro Ltd has asked about 445 people 'separate' this year. This includes about 380 people from its software development and export division, Wipro Technologies and about 65 to 70 people from its domestic systems and services division, Wipro Infotech.

Wipro corporate executive Vice President (Human Resources), Dileep Ranjnekar said, the move was not lay-offs. "Every year we go through a very intense performance appraisal system. From this the Top 10 percent (employees identified as the best performers) and the bottom 5 per cent are identified."

Of this, according to Ranjekar, an action plan is charted out for the bottom 5 per cent. "We first look at what development plans can we undertaken for the bottom line. These could include additional training, mentoring, or if there are relationship issues within the group – even shifting them to another group." The performance of these employees is closely monitored and after a designated period of time –which could vary from three to six months – they are either taken off the watch list or, as Ranjnekar says, "separated."

According to Ranjnekar, Wipro has done this almost every year, with the only exception at Wipro Technologies last year, when the business and HR environment was such that companies were looking for ways and means of retaining people, rather than sifting out the bottom performers.

"It is important to understand, however," says Ranjnekar "that the bottom five may actually be good performers in the absolute sense. Its just that in the relative performance levels within Wipro, they might be at the bottom of the beaker."

According to Ranjnekar, a five-step HR exercise is undertaken. People whose performance levels are not up to expectations are called in for a talk with their seniors in the presence of a HR official and the action plan is outlined for them.

"In cases where people are asked to leave, we ask them first how long it would take them to find a job. The company and the employee agree on outer time limit and we’ve found that almost all of them find a job within that time."

When asked why so many people were "separated" this year Ranjnekar said "the absolute numbers look big because as a company we’ve grown. In 1999-2000 we had about 220 people. We hired 5,000 additional people since then. The percentage of people asked to go remains more or less the same, it's just that the absolute figures have changed. It’s a very painful process. So this exercise is not undertaken lightly. A lot of time and effort and thought goes into the process."

Besides, says Ranjnekar, the same exercise last year hadn’t invited the kind of attention as this year. "A lot of it has to do with the slowdown and the changed business environment. Suddenly, everything done looks big."

Wipro Lays off 2500 Employees

Wipro lay off 2500 employee

Wipro Technologies has put about 4-5 per cent of its workforce, about 2,400-3,000 employees, under the scanner for non-performance. Company sources reveal that about 1,000 employees have been asked to leave.

While some would be given counselling to improve their performance, others would be asked to leave.

Wipro’s corporate vice-president (human resources) Pratik Kumar confirmed the move. Asked how many employees had been asked to move on, he said the company did not disclose that number, but it was “significantly lower than 2,000”. “I can’t comment on a particular number,” Kumar said, when asked to comment.

“It’s a regular annual exercise. As the appraisal cycle gets over, a multi-layer review happens. Following that, people who have fallen in the lower quadrants of performance are put on watch. Some are asked to pull up and others are asked to move on,” he said.

The review includes all the 60,000 global IT services employees from the senior leadership team down to the person with one-year experience.

US Recession and Indian IT

BANGALORE, INDIA: The signs are for all to see. US employment fell for the first time since 2003, manufacturing declined 5.3 percent, first time house buying - a good proxy for economic health - plunged 8.1 percent in December. Technically, it might not qualify as a recession, but according to Warren Buffet, "by common sense definition", the U.S. economy already is in a recession. A December report on the Indian tech sector by Morgan Stanley says the uncertainty in the United States may delay tech spends in the first half of 2008. With Indian IT salaries rising 10-15 percent a year, the overall operating margins have been reduced to six percent.

The major crisis in the US financial markets has had a ripple effect on all sectors and it might be a while before things start looking up. As Laksmi Narayanan, Nasscom chairman and VC of Cognizant said, "The current situation is not temporary. It is the new baseline. The industry will have to learn to operate under the new parameters." Anecdotal evidence suggests that fewer development projects from existing clients are coming through. The sales cycles have increased and winning new customers has become increasingly difficult. If there was a major watershed in the Indian IT Industry post Y2K, this is it. After the dizzying growth of the last 10 years, it is time to pause, reflect and realign strategies. If the industry has to survive, then it needs to adapt to the changing market scenarios quickly. Talk of a software upgrade. Diversify globally For far too long, Indian IT industry has focused on the US. Yes, US accounts for about 60 percent of the total IT spending.

However, IT spending of American companies is slipping with the slump. It's also been a long time since US firms embraced the outsourcing model, so further growth seems very limited. With that in mind, the Indian IT firms need to focus their attention on the other markets, especially Europe. Using UK as the base, software firms can branch out onto mainland Europe. There will be a certain amount of language and cultural resistance in countries like France, Germany, and Nsetherlands, that Indian firms will need to grapple with. Eastern Europe has a large number of skilled software programmers. Many global firms want to continue offshoring, however they are looking at non-India based partners as a way of addressing the issues of talent shortage, salary hikes, and high turnover which are becoming more acute in the Indian IT sector. Such firms are even willing to back development centers run by Indian giants elsewhere, purely from the standpoint of flexibility, business continuity, and seamlessness in global operations. Hence, Indian IT companies should establish a strong presence globally through delivery centers in emerging regions, so as to maintain its existing business and gain a bigger portion of the IT revenues pie.

Local foray it makes sense to enter the local markets decisively. Indian IT market is growing at a compounded annual rate of 21 percent. Indian companies have been traditionally slow in embracing IT, but are now adopting technology at a breakneck speed. A few large multi-million dollar contracts like the Bharti-IBM, Dabur-Accenture and SBI-TCS deals should make the rest of industry sit up and recognize the potential of the Indian market. South East Asia is another region where IT big-wigs can focus their energies. China, Korea, Japan, Australia are big markets, and Indian firms should make a firm thrust in capturing them. The region can not only be tapped for local markets, but also be used as satellite facilities to support their Indian counterparts. Tighten recruitment and retention processes Since the last few years, the composition of IT resource pool has undergone a substantial shift. Earlier, many reputed companies only recruited engineers through campus placements.

However, the demand for Indian IT services kept getting bigger. Post dot-com bust and 9/11 tragedy, business conditions in the US became tougher, and companies wanted to focus on key operational and strategic functions and outsource technical application development and support to the experts. India as an IT destination offered notable cost advantage, better flexibility, 24/7 support and improved accountability. Figures suggest that only 25 percent of the total graduates in India have employable 'production-worthy' skills.

Fewer contracts in a sluggish economic scenario would automatically drive down the break-neck speed of recruitment. However, instead of a complete stop to all recruitment, the IT industry should use this period for a meaningful introspection and a substantial realignment of its hiring and retention processes. Address the skills shortage Concurrently, this quiet period needs to be used to get the existing resource pool ready for the next big wave. Most programmers are too caught up in the daily quotidian tasks to catch up on the latest technical advances, and appreciate breakthroughs that will sweep the IT world. To address this gap, workshops and technical trainings to educate the workforce should be held at regular intervals. Similar sessions on soft-skills and cultural orientation programs should be conducted to make the people more customer-centric. Service Oriented Architecture, Software-as-a-Service, Cloud Paradigm (or desktop virtualization) are emerging as some of the biggest IT trends.

Additionally, platform consolidation is the biggest IT change that many CIOs have on their radar. Much of the work coming along will be governed by these trends. The software designers should be brought up to speed on these new trends, and the programmers trained on the technologies that underline these trends. Upside down in a Flat World Cut-throat competition from global players and the falling dollar has squeezed the margins for typical run-of-the-mill work. Yes, consulting is a niche that eventually all Indian IT companies would want to get into. But basic factors like maturity (dearth of experienced consultants), perception (image of Indian IT firms as application developers and implementors) and location (failing of global delivery model in primarily client based work) will hinder any real inroads into the consulting space. The trick is to innovate - not necessarily do different things, but do things differently.

In that regard, the focus on innovation of some of the top Indian companies is a step in the right direction. Wipro's Applied Innovation Framework lays down a roadmap for systemic change to deliver sustainable business benefits. Summing IT up This is indeed a tricky time for the Indian IT industry, but there's no real reason to panic. The IT guns showed great character and resilience during the years following the dot com bust. They are wise enough to read the signs and realize that change is in order. With a slight course correction and an unswerving view on the long-term, the India IT industry can emerge stronger and bigger.