Infosys Ltd, India’s second-largest software exporter by revenue, aims to reduce high attrition levels with skilling programmes and compensation-based incentives.
The attrition rate at Infosys was 23.4% in the April-June quarter, up from 20.4% in the previous quarter. This is much higher than competitor Tata Consultancy Services Ltd’s attrition rate that stood at 11.5% in the June quarter.
The attrition rate at Infosys increased in the June quarter despite measures such as variable compensation, higher promotions, overseas postings and retention bonuses and is “beyond the comfort range for the company", according to a 29 August report by brokerage firm Sharekhan. “The high attrition has negative impacts like higher recruitment costs, dissatisfaction among the employees, lower client satisfaction, and lower utilisation," the report stated.
The company’s attrition rate has been the highest among employees with 3-5 years’ experience, Krishnamurthy Shankar, executive vice president and group head of human resource at Infosys said in an interview. “The Bengaluru numbers are even higher," he said.
Infosys has taken various steps in terms of skilling its workforce, to address the rising attrition levels. “We are very confident attrition will come down. A lot of emphasis is being put on training," Shankar said.
Infosys has created something called digital tags—essentially digital skill sets that you can learn and tag yourself to. “We have identified a set of 32 skill sets in areas such as cloud architecture and internet of things, wherein we have created specific learning pathways for each of these skills sets. The employees get a certification and a skill tag. We also incentivize them through a skill bonus," he said.
Infosys is also focusing on early career growth of employees with incentives such as “early career rewards" so that they are clear about their growth path within the organization in the first few years itself, Shankar said.
The company has also launched what it calls “bridge programmes", which enable employees to pick up alternative skills, which in turn brings higher compensation. The scheme is expected to help in upskilling to meet the demands of the future as well as open up more career options, especially for young employees.
A recent trend is employees quitting jobs to pursue entrepreneurship. Infosys specifically doesn’t have any ‘intrapreneurship’ programmes, but “we have something called the Infosys Innovation Lab and hackathons where we help create proof of concepts," Shankar said.
The company’s ‘Be the Navigator’ programme helps in “continuous improvement for the client." The objective of the programme is that clients should look upon Infosys business process management (BPM) as business partners who own their end-to-end process and drive business outcomes, the company said.
“While reskilling by companies can solve part of the problem, it’s not enough. Today, many people do reskilling on their own and when they switch jobs, they easily get a 30% hike, which a normal appraisal within the company can never match up to," said Sanchit Vir Gogia, chief analyst, Greyhound Research.