Archive for September, 2010

Beware of the new kid on the block!

Thursday, September 2nd, 2010

Child is the father of man. Never before has it become so apparent than now when we take these two names in one breath- China and India. From sops to concessions to lures- the Chinese are trying every trick in the book to make IT rake moolah for them. China recently waived operating taxes on offshore service outsourcing business in 21 of its key cities. Conditions apply. Employ at least (pun intended) 75% of the Chinese in the company.

Sops are too alluring for the IT industry whose technical expertise relies on the availability of capital. Hence, so far it looks so good. And no, India isn’t jealous at all. However, often the first impressions are not the last. China has caught the same bus that India had a few decades ago. That too at the cost of snatching away the Indian seat. China is definitely intending to end India’s dominance in the information technology outsourcing industry. And it has made it pretty clear.

The icing on the cake for the Chinese is that they are finding their biggest ally in their biggest rival i.e India. The Software Technology Parks of India (STPI) scheme, dubbed as the tax holiday for IT parks, will end (after extension) on March 31, 2011. And everybody on the government front is seeing this as another opportunity for the growth of IT sector in India. It seems that the IT parks have gotten addicted to tax holidays. However, the point that is badly missed in this entire bid of providing sops is that this may hamper the long-term and a matured growth of our IT industry, which is what is required at the moment.

In the meantime, NASSCOM has written to the government for a minimum of a two-year extension of the scheme. Here too, it is important to note that the sops provided under the STPI scheme will finally lead to bringing up the Chinese IT industry, resulting in a long-term loss for the Indians. Also, no attention has been paid on currency fluctuation risks for exporting companies.

Ours is a matured IT market and we must encash this forte. Thus, it is very important that collective talks are held involving the IT industry representatives to see through the Chinese intentions and work for the betterment of the Indian IT industry. Hope someone up there right at the centre is listening!

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Is there a counterpoint to attrition?

Thursday, September 2nd, 2010

Tech town looks pretty upset lately. The obviously visible reason is the rising attrition rates. The attrition rates have gone up to 20% in a quarter’s time in giants like Infosys, HCL, Wipro and others. Organizations are forced to redefine stability. Employers feel cheated. Ironically enough, attrition has entered IT industry during prosperous times.

Even as the worries of attrition keep increasing by leaps and bounds every day, AnyLinuxWork prefers to look at the other side of the picture. Says ALW CEO Vivek Singhal, “There were two options available to organizations during recession. One, staff cutting to save costs and adjust with losses. Two, refuse lay-offs and focus on employee productivity. We chose the latter one.” Instead of resorting to lay-offs, ALW chose to face the situation by employee encouragement through pay hikes. And today most people who have stuck with it are those who value this.

The message is clear. We must adjust and customize depending on the situations but we can never afford to ignore future. We cannot refute the effects of global recession during the past few years on Indian IT industry, being worst hit. Yet it has risen above the troubled waters in record time. Ever since the industry has been sailing on an optimistic ship with the workforce as its strength.

In the midst of this, with attrition hitting the scene, it is difficult to imagine how fast loyalties can shift as a major chunk of workforce leaves for greener pastures. And this is happening to organizations that refused lay-offs during recession and stood by their employees. So here’s the deal. If people who can shift loyalties so fast depart from an organization, it leaves room for the new talent who are ambitious, fresh and open to learning. Attrition, in fact, is creating opportunities for the talented young people with clearly defined professional objectives.

Adds Vivek, “I feel attrition has forced us to reconsider the way we look at a crisis. Ironically, the seeds of destruction are laid in the seed itself. And every such destruction leads to something better. Destruction inevitably leads to construction.” This should be the thought to take home. Shouldn’t it?

Posted in Company blog, Office Space | 34 Comments »