Bangalore: Indian information technology (IT) service providers such as Tata Consultancy Services Ltd, Infosys Technologies Ltd and Wipro Ltd are following multinational firms such as International Business Machines Corp. (IBM) in building a technical career path for senior engineers opting out of managerial roles.
This is a shift from their traditional focus on promoting employees for managerial roles as they seek more complex projects from customers that need highly skilled people to execute them.
Now, employees can opt to be a designer or an architect and climb the ladder conceiving or building large projects.
“It will be very good for the industry. I believe it is good for India,” said Madana Kumar, manager for professional and technical learning at IBM India.
IBM, which employs 73,000 people in India, offers technical career paths for employees, who can grow to levels of vice-president without managing people, following the model of its US parent. This focus has helped IBM to get large projects from customers such as Bharti Airtel Ltd, Kumar said.
The Indian IT industry is under pressure to refine its business models, facing pressure from multinational rivals such as IBM and Hewlett-Packard Co., and customers demanding more productivity and accountability in projects following the downturn.
As a result, Indian IT firms are shifting to deals where the bills are tagged to the outcomes of the projects than to the number of people deployed. These firms are also taking on more complex work, such as designing and managing telecom networks, and building customized security and software products for their customers.
This demands a higher degree of productivity from engineers, an ability to build intellectual property, and advanced code writers than those groomed over the past decade.
The Indian IT industry employed 284,000 in fiscal 2000, when software exports were at Rs17,150 crore. In fiscal 2010, the sector is expected to clock exports of $49.7 billion (Rs2.3 trillion), employing 2.3 million, according to industry lobby Nasscom.
“Our projects are becoming more complex. Clients want more value addition,” said S. Gopalakrishnan, chief executive at Infosys. “They are giving us some of their mission-critical programmes... So, they want depth in the technical and industry knowledge of the people.”
In October, India’s second largest software exporter introduced a career enhancement programme that charts defined technical roles for its engineers so they can grow as IT architects or domain consultants.
To give an indication of the shift in the complexity of work for Indian IT firms, Infosys in 2000 earned 72% of its revenue from application, development and maintainence (ADM) services—vanilla projects that are increasingly getting commodotized. In 2009, its revenue from such services decreased to 41.6%.
For TCS, India’s largest technology vendor, revenue from such services has reduced to 48.5% in fiscal 2009, from 58.2% in fiscal 2006, the first year it began classifying ADM figures.
TCS, too, is focusing on creating a role-based organization to ensure effective competency development, under which specific skills are assigned to roles such as architects or developers, said Ajoy Mukherjee, vice-president and head of global human resources at TCS.
At Wipro, engineers need to pick up at least one additional technical skill every year and pass a test before they can be eligible for promotion. The firm is in the third of its seven-year competency mapping plan, which it uses to assess and improve the technical skills of its employees.
“Increasingly, the type of projects we are getting needs people with huge depth in technical skills,” said Girish Paranjpe, joint chief executive at Wipro. “It is not readily available; we have to create it.”