In the current market scene where companies are struggling to keep up profits, many big MNCs have handed over pink slips to their employees. Now, Infosys, the Indian software services giant is looking towards laying off non-performers.
The company has nearly 150,000 employees and it plans to cut costs and raise the its potential efficiency. The move is reportedly to lay off under-achievers, while not to cut staff in general. NR Narayana Murthy, the Infosys executive chairman, said that employees who are hired at high salaries and are not performing, are likely to be asked to leave. Murthy returned from retirement to head Infosys since the company struggled after his leaving.
He returned last June, to put Infosys back on higher growth track. In a TOI report, Murthy said, “One of my tasks was to ensure that the identified people who were receiving very high salaries but were not contributing as much as we wanted, were either given opportunities where they can add value to the company or they could seek opportunities elsewhere,” at the Bank of America Merrill Lynch India Investor Conference. The Infosys co-founder Murthy, put confidence among analysts that the company is taking many initiatives to increase employee productivity. The company will keep focus on lowering the on-site costs by shifting more work offshore.
“Our desire is that Infosys should get back to industry leading growth rates. What that growth rate will be is something that we will tell you as we move forward,” he said in the same report. Murthy, on his return, initiated an organisational restructuring wherein the company’s eight top-level personnel were asked to leave, which included America’s head Ashok Vemuri and BPO head V Balakrishnan. Murthy also told analysts that the Infosys would have a new chief executive by March 2015, when another co-founder and present CEO, SD Shibulal, will retire. Infosys’ revenue growth rate dropped majorly in the last few years, that concerned both the investors and analysts.
“Our costs have ballooned very rapidly in the last 2-3 years. For example, on-site compensation was 36 per cent of the overall revenue in 2010-11 and it went up to 46.3 per cent in 2012-13. A part of it was because we hired people at high salaries outside India and these people did not add value to the company,” Murthy further said at the conference.
Source: EFY Times