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TCS likely to take a call on promotions for current fiscal
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TCS likely to take a call on promotions for current fiscal
MUMBAI: Tata Consultancy Services (TCS), which faces uncertainty from auto clients such as Chrysler and General Motors, will undertake a review at the end of the first quarter to decide whether to offer any promotions in the current financial year. Promotions are typically announced in the second quarter of the fiscal.
“We are considering promotions in the second quarter, but will review it at end of the first quarter. As of now, we plan to go ahead, but it is not cast in stone because there is a certain cost involved. It would depend on business environment and outlook,” said TCS head (global HR) Ajoy Mukherjee. The review process will assess the total impact on the compensation side, if the company decides to go ahead with the promotions.
Increments, even if the promotions are given, will not be of the same order, as in the hey days and there will be no increments across the board, he added. Last year, despite the turmoil in the financial market and the collapse of some of its major clients, TCS had given an average increment of 10% to all its employees in India on a cost-to-company (CTC) basis. However, the major impact of the financial crisis was felt on IT companies only in the second half of FY09.
For FY09, 95% of TCS’ staff also received 95% of their variable pay. The variable pay accounts for 30% of total CTC at an organisation-wide level. However, the company changed the pay-out structure, so part of the variable pay was given out at the end of every quarter, instead of at the beginning of every month. This may be tweaked further in this fiscal so a larger component is now received at the end of the quarter, rather than at the beginning of the month, said Mr Mukherjee.
“The ability to adjust the variable component gives you some amount of leeway to handle the uncertainties and also inculcates and performance culture. First is whether the company has achieved its target because that decides the kitty. And then whether individually you have performed and whether your business unit has performed,” he said.
The company had 1,100 performance-based separations globally in FY09 and Mr Mukherjee said there were no layoffs because there was no targeted reduction of employee headcount as a cost-cutting initiative. The company has been able to manage its costs by improving the amount the work it does from India, which is at a lower cost base, and by controlling the number of experienced people it hires in FY09.
Source:
http://economictimes.indiatimes.com/Infotech/TCS-may-take-a-call-on-promotions/a
“We are considering promotions in the second quarter, but will review it at end of the first quarter. As of now, we plan to go ahead, but it is not cast in stone because there is a certain cost involved. It would depend on business environment and outlook,” said TCS head (global HR) Ajoy Mukherjee. The review process will assess the total impact on the compensation side, if the company decides to go ahead with the promotions.
Increments, even if the promotions are given, will not be of the same order, as in the hey days and there will be no increments across the board, he added. Last year, despite the turmoil in the financial market and the collapse of some of its major clients, TCS had given an average increment of 10% to all its employees in India on a cost-to-company (CTC) basis. However, the major impact of the financial crisis was felt on IT companies only in the second half of FY09.
For FY09, 95% of TCS’ staff also received 95% of their variable pay. The variable pay accounts for 30% of total CTC at an organisation-wide level. However, the company changed the pay-out structure, so part of the variable pay was given out at the end of every quarter, instead of at the beginning of every month. This may be tweaked further in this fiscal so a larger component is now received at the end of the quarter, rather than at the beginning of the month, said Mr Mukherjee.
“The ability to adjust the variable component gives you some amount of leeway to handle the uncertainties and also inculcates and performance culture. First is whether the company has achieved its target because that decides the kitty. And then whether individually you have performed and whether your business unit has performed,” he said.
The company had 1,100 performance-based separations globally in FY09 and Mr Mukherjee said there were no layoffs because there was no targeted reduction of employee headcount as a cost-cutting initiative. The company has been able to manage its costs by improving the amount the work it does from India, which is at a lower cost base, and by controlling the number of experienced people it hires in FY09.
Source:
http://economictimes.indiatimes.com/Infotech/TCS-may-take-a-call-on-promotions/a
