With an employee base of over one lakh each, the biggest challenge for IT companies is keeping a check on attrition. But these numbers have taken an interesting turn over the past one year.
The country’s largest IT services exporter, Tata Consultancy Services (TCS), has been struggling to contain its rising employee attrition rate, while its closest competitors — Infosys, Wipro and HCL Technologies — have managed to bring it down and keep it under control.
Curiously, among the four Indian IT majors, TCS has traditionally enjoyed lower employee attrition rate, but it has been rising over the year. At the end of second quarter of FY15, its attrition rate was 12.8%, and a year later, at the end of Q2FY16, it has touched 15.5%.
However, TCS claims that its attrition level is under control, and they expect a decline in the near future. N Chandrasekaran, CEO & MD, said at the company’s analyst call post the quarterly results: “Currently I think attrition has come under control. We are actually seeing a drop in attrition, especially in India and in other parts of the world as well. We also saw sequential decline in attrition from July to August to September. So we expect the trend to continue.”
Infosys, India’s second-largest IT services exporter, which has been battling high attrition rates across all levels for the past 12-14 months, has managed to bring it under reasonable control due to its numerous HR measures. At the end of September quarter, 2014, the attrition level at the IT major was 21.1%, but one year down the line, it has come down to 14.1%.
Infosys CEO Vishal Sikka, during the company’s recent quarter analyst call, said, “In annualised terms, standalone attrition has dropped to 14.1% this quarter. We continue to simplify our internal processes and have redesigned our performance management framework to focus more on individual accountability, individual responsibility and continuous feedback.”
Wipro has managed to keep its attrition level steady at around 16% over the past one year. Saurabh Govil, senior VP & global head, HR, Wipro, felt that its attrition level has been under control and is playing in a narrow band. “We expect it go down lower from the current level,” he remarked.
Echoing similar thoughts, Prithvi Shergill, chief human resources officer, HCL Technologies, said, “Our voluntary attrition level has been flat for the last six-nine quarters or more. It is a challenge everyday, but we hope that it will remain at that level.”
The $146-billion Indian IT industry employs more than three million people. Even in the current situation, when the growth momentum is not very strong, the attrition level still remains high for companies, especially in the three-five years’ experience category. Then there is also the new challenge of losing their mid-level executives to the new-age e-commerce and start-up firms.
Attrition levels in the Indian IT industry have largely been the function of supply and demand, and is unlikely to go down to single digits despite the sector’s major thrust towards automation technologies with lesser dependence on human resources.