6,500 offer letters handed out but joining date postponed to fourth quarter
HYDERABAD: In a bid to tighten its belt further, Satyam Computer Services, the Hyderabad-based information technology major, has decided to delay the induction of trainees hired through campus placement programmes.
The company has already said it would slash its new recruitments from the earlier 14,000-15,000 to 8,000-10,000.
Trainees, who form a huge chunk of the IT services major’s workforce, are selected from various colleges across the country. This year, the company issued about 6,500 offer letters during campus recruitments. However, those that were given these letters are still waiting to hear from Satyam on their joining dates. They just might have to wait longer.
S V Krishnan, the head of human resources at Satyam, said, “We have decided to look at the issue of taking trainees on board only in the fourth quarter.” In the normal course, these trainees would have joined the company in the third quarter.
“We have already taken in about 1,200 candidates last quarter. Though the process of taking others on the payrolls is delayed, we are committed to honouring each and every offer letter we gave,” said Krishnan.
Satyam maintains an equal proportion of trainees and experienced staff on its campuses. This has been looked at as a major negative factor and the company has been also criticised for replacing experienced workforce with trainees to save costs.
“It is a fact that we maintain about 50:50 balance between trainees and experienced employees. As a company, we have the responsibility of striking a balance between the demands of our investors and customers. The trainee pool will meet our investors’ demand and the experienced workforce satisfies the needs of our customers,” Krishnan said.
As much as 60% of Satyam’s income goes into its labour expenses and so, any cost-cutting exercise would invariably impact the workforce. “We have brought in several measures to control costs. Travel is one major issue that will have a direct impact on costs. Now, instead of sending eight people for an on-site project, we are sending six and asking the remaining two to coordinate with the travelling team from India itself,” Krishnan said.
Another thing under scrutiny is celebrations by employees - usually, completion of projects, achievements etc are celebrated through company-sponsored dinners, lunches and outings. “We don’t want them to stop celebrating. But, we want them to do it in a responsible way,” he said.
Krishnan expects these measures to have a direct impact on costs. “We may not be able to bring down human resources costs significantly but even if it comes down to 58% of our revenues from 60%, it is good enough in these markets,” he said.
On the issue of pink slips, Krishnan said the company wasn’t looking at firing people as a majority of the workforce had been deployed prudently. “In the first half of 2007, we had an attrition rate of 13.5% with an employee base of 39,900. In the first half of this year, attrition is at 12.3% while employee base has increased to 46,500 in Satyam alone (excluding subsidiaries),” he said.
k_ramana@dnaindia.net
