Infosys Technologies is entering into its next growth phase that will see the IT bellwether actively seek acquisitions for owning IPs/ platforms to remain relevant to its customers.

For this to happen, it plans to change the workforce-mix laying more emphasis on those who can adapt to the creation of IPs (intellectual property) while at the same time enable it to reduce reliance on adding headcount. Infosys has already about 2,500 people across various verticals working on creating IPs and solutions.

To ‘let go' staff

At some point of time, it could also “let go'' resources as the reliance on headcount to grow business reduces and due to change in mindset to focus on creating IPs, according to a March report from Edelweiss Securities.

“We believe the company is now taking multiple steps to remain relevant to its customers. It agrees that the linear growth model is not sustainable in the long run and the value proposition of cost alone is not sufficient to scale up client accounts,” the report said.

It is also looking at getting more out of its senior consultants/ managers who are right now not directly billable but is taking steps to make them functional experts. A HR consultancy firm which works closely with the Big Three of the IT sector told Business Line that there are close to 5,000 managers in Infosys who are earning over Rs 15 lakh a year and there is a “deliberate attempt by the company to make these senior people functional experts and place them in consulting roles.”

Selective on job switchers

The Edelweiss report also points out that Infosys will ‘let go employees as there seems to be a change in mindset to focus on creating IPs and solutions rather than offering cost arbitrage.' This could also be the reason the company is looking at more B-school graduates while at the same time preparing its engineers for business roles through various in-house training programmes. Mr T V Mohandas Pai, Director, HR and Administration, has recently said that the company is not willing to employ any person who has changed more than two jobs in the last five years.

Mr Rishi Das, CEO, CareerNet, pointed out that there is a lot of thrust by large companies where senior managers can be made billable for the expertise they have gathered over the years.

Higher risk

Mr E. Balaji, CEO, MaFoi Consulting, said that a change in workforce and some amount of redundancy in current talent pool is inevitable for companies that are going in for higher value work. “If you want higher margins, you have to get out of commoditised work. This may be a five-year road map for a company like Infosys,” he says.

The Edelweiss report pointed out that IT vendors will have to assume higher risk in terms of delivering the impact that clients like to see taking up an initiative. “Hence, projects would be priced based on outcome, or IP-led solutions would be priced with linkage to revenue potential for client.”

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