The country’s fourth largest IT firm, Wipro has started the process of downsizing its mid-level staff, to improve its margins, which is the lowest among the top four IT services companies. The process will see hundreds of people losing their jobs, sources said.
Most of the employees who are likely to be laid off are in non-billable sections. There are also some in the billable sections whose role can be automated.
Sources said that the Wipro’s move to downsize headcount is part of a “Left-Shift” strategy. Herein the work of a level 3 employee is shifted to a level 2 employee, who is given appropriate tools. A level 1 employee does the level 2 work, and the work of level 1 employee is automated.
The challenge before Wipro’s CEO, Thierry Delaporte is to balance margin and growth. When contacted a Wipro spokesperson said, “Aligning our business and talent to the changing market environment is a critical part of our strategy as we look to build a resilient, agile, and high-performance organisation”.
The spokesperson added that Wipro is committed to investing in people, processes, and technology to drive better client and employee experiences and enhance productivity and agility across the organisation to meet fast-evolving client and market needs.
During the October-December quarter Wipro’s margin came in at 16%. Tata Consultancy Services, Infosys, and HCLTech reported margins of 25%, 20.5%, and 19.8% respectively.
Sources said that Wipro is working big time on automation and has committed to invest $1 billion on AI technologies over the next three years. It has launched AI-first innovation ecosystem, Wipro ai360, to integrate AI into every platform, every tool, and every solution used internally and offered to its clients.
“We are aligning our operational structure, skilling academies and Gen AI capabilities to market demand, client expectations and also to the evolving process landscape inside Wipro. We are one of the biggest customers of our ai360 ecosystem.
These transformation programs and margin expansion initiatives are delivering results. Our goals remain profitable growth, delivery excellence, and internal capability development, all leading towards sustainable success,” Amit Choudhary, chief operating officer, Wipro had said during the Q3 earnings call.