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19% Infy Staff Quits, Raises Alarm

MAY 11, 2014

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19% Infy Staff Quits, Raises Alarm


Infosys, which once used to be a bellwether for the Indian IT industry, is fast losing the No. 1 employer tag for young IT workers. Infosys staffers are leaving the co. at an unprecedented rate as it tries to catch up with its rivals. A series of senior management exits and worries over career prospects in the co. have led to low morale among employees. At Infosys, annual revenue rose by 24% last year, lagging behind TCS's 30%, while the annual attrition  —  staff leaving or retiring was a record 18.7 %,  which is 2.4% higher than the previous year. That's close to one-fifths of a total workforce of 160,000. The attrition rate at TCS was 11.3 %.

The Indian outsourcing industry has relied on engineering graduates to build the so-called "bench strength", a key to new IT contracts. A strong "bench" signals to the clients that the co. has enough manpower for new projects.



Infosys's average 6-7 % pay rise for its Indian staff is below the average 10% hike at TCS. Infosys is taking steps to stem the attrition rate by having more frequent reviews, fast-track promotions and a higher fixed component in pay pacakges. It has been holding more 'town hall' meetings and 'jam sessions' for the staff to speak informally with management.


All new Infosys recruits are put on a 23-week training, regarded as among the best, in a Silicon Valley-style sprawling campus, with multi-cuisine food courts and state-of-the-art gymnasiums. Besides, employee stock options have also helped create many salaried millionaires. In recent years, however, Infosys has been criticized for its conservatism in chasing new business,  over- dependence on Murthy, which has slowed down the development of new leadership.



A revamp called "Infosys 3.0" had been aimed at revitalizing the co. but did not deliver, prompting Murthy's comeback. But his return, with son Rohan as his executive assistant, saw at least 9 senior executives leave amidst a reshuffle. Future growth for India's large IT cos. is to be driven by infrastructure, social media, applications (apps) and cloud computing, areas in which Infosys lags behind its rivals.


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