Wipro Technologies indicates that it is going to tighten its belt on hiring and is witnessing shortage in skilled manpower. The firm is expecting stable volume growth. Girish Paranjpe, its joint CEO, in an interaction with Rachana Khanzode & Surabhi Agarwal said the firm is re-looking at the strategy of higher bench. Excerpts:

What are your hiring plans at present?

We want to hire about 7,500 freshers for the next two quarters and our team is looking at getting hold of as many laterals as possible. Because at least in near terms, we are witnessing a shortage in supply of laterals across skill sets and experience. But we are going to colleges and tighten our belt. Last quarter when there was a volume growth and our utilisation levels had gone up, so it is not necessary that you need to have lower utilisation when volumes go up.

Why did you maintain a higher bench earlier?

We are re-looking at that strategy. We have realised that high bench is not strategically a good option. What is more relevant is ?smart bench?.

Is that also a part of the cost cutting initiatives?

Cost-cutting factors would continue to be an important lever for us. We have been always careful in spending. We think there is opportunity in rebalancing the way we spend. Even in recession we did spend on key long-term strategic initiative like investing in Atlanta and China, increasing global mix of presence or hiring consultants. So the whole of idea of re-prioritising spending would continue.

But when volumes pick up, how are you going to scale up because you have already reached a utilisation level of 84%?

So the point is why do we need a 30,000 bench to fill up a 4,000 demand and you have seven quarters in hand before the actual need comes. We have been rethinking on this basic idea of why do we need such a huge bench.

Usually a bench scale is linked to the expected demand. How does the volume outlook look like for the coming year?

Last year clients had not only slashed their budgets but were not even spending approved budgets. But the volumes have come back in the last 4-5 months and if this stablility continues for the next 12 months and people spend their allocated budgets volumes can be maintained. More over additional spend from mergers and acquisitions and regulatory requirements would add up. So flattish budget and more normal spent will give us a benefit of the 12 month basis unlike now when we have it on a quarter basis.

So can we say that pricing would bounce back to the 2007 levels?

The pricing levels are stable at the current levels and what we have done is focused on realisation than sticker price. So we improve efficiency in delivery and gain more realization without having charged additionally to clients. We can keep that gain and we have about 42% of our contracts under fixed price format. Though we ideally feel the fixed price contracts should be about 80% as it gives us more ownership and control. At the same time, we have helped our clients in their turbulent times and in case we see a drastic cost push and rupee strengthening we are hoping that our clients would help.