Infosys Ltd has started aggressively hiring laterals, with more clients pushing IT majors to get their projects off the ground faster.
Hit by weak booking of projects because of lack of senior resources, Infosys has increased lateral hiring to 40 per cent of gross hiring (about 45,000 during the current fiscal), which it plans to continue for the fiscal.
The increase in lateral hiring is the highest during the last 16 quarters for Infosys, which has always focused on hiring more freshers.
According to an analyst with IDFC, hiring of project managers and solution architects, who are needed during project bookings, would help Infosys capitalise on strong demand.
Mr Vinay Nijhawan, co-founder and head, corporate relations and HR, Purple Leap (a company that builds campus-corporate relationships), said companies whose business model rests on the cost arbitrage factor do make some changes in the fresher to lateral hires.
“The company could only be correcting the pyramid structure,” he pointed out.
IDFC puts it down to the fact that Infosys was not equipped to handle the strong demand rebound seen in FY11, which meant that supply crunch prevented it from fully capitalising on demand. In fact, employee utilisation shot up to a historic high of 80 per cent-plus in Q2 and Q3 compared with the optimal band of 74 per cent-78 per cent.
In a recent report, an Anand Rathi analyst pointed out that while the first half of this fiscal might lag, momentum will pick up in the second half, when the need for senior managers would arise to close the deals.
Mr Karthik Ananth, Director-Market Expansion at consulting firm Zinnov, sees nothing unusual in Infosys changing its campus to lateral hiring ratio.
“As the fresher weight gets higher, the blended billing rates come down; and companies do this to balance it out. Most companies do this regularly to remain static.”
Mr Ananth said soon other large IT companies too will start lateral hiring.
Keywords: lateral hiring,
Comments:
Please Email the Editor