TCS expects to bring attrition level to below 14% this fiscal 

The country's largest software exporter Tata Consultancy Services expects to rein in attrition to a level below 14 per cent by the current fiscal end, a top company official has indicated.

For the first quarter ended June 30, the Tata group company had a reported churn rate of 14.8 per cent.

It may be recalled that till few years ago TCS' churn rate used to be in the range of 11-12 per cent.

“By the year-end, attrition will be in the range of 13-14 per cent…We are doing further interventions to bring attrition further down but it will take a long time before we reach levels of 11-12 per cent,” said Mr Ajoy Mukherjee, Vice-President, Head, Global Human Resources, TCS.

Retention bonuses

The company has put in place measures to ensure job rotation opportunities for staff. It also dishes out retention bonuses on a selective basis to lateral staffers who come on board TCS.

According to Mr Mukherjee, Q1 is when several employees go in for further studies. Secondly, the appraisal process which happened during the quarter would cause employees that are not happy with their ratings to look out for external opportunities.

“These two factors will be at play till the middle of Q2…after that we will see attrition tapering off,” Mr Mukherjee told Business Line .

Moreover, the industry is back to the days of hyper growth and hence there is tremendous demand for trained talent.

According to a TCS employee that Business Line spoke to, the company's focus on increasing offshore revenues, coupled with its strategy of engaging temporary staffers for onsite assignments is de-motivating employees to stay put. In any IT company, staffers look forward to potential spells stints in overseas geographies at client locations.

However, TCS has been increasingly using the services of business associates or temporary staffers in the US to tide over the delays in getting H1B visas and the increased rejection rates for such work permits.

Biz associate ratio

“If I look at the business associate to employee ratio, we generally keep it around 4-5 per cent. However, that percentage has slightly gone up in the US,” said Mr Mukherjee.

These business associates or temporary workers are generally local employees who come through temporary staffing companies. Their services are availed when there is a dearth of specific skill sets or when there are immediate ramp up requirements.

“Engaging business associates is not cheap at all…it is not about the cost but the need to have people when required since we do not maintain a bench in the US. If my project is in a stage where I need to have people or else my delivery will suffer, the only way you can do it faster is through business associates,” said Mr Mukherjee.

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