Satyam staff worried new employer may cut jobs

G. Naga Sridhar
M. Somasekhar


Hyderabad, April 12 A day ahead of the start of the stake sale process of Satyam, worries about a possible “optimisation” of human resources by the new owner bother many employees.

“There has been widespread talk about a reorganisation of human resources and changing the business focus in line with the interests of the successful bidder,” Mr Ramesh, a Satyam staffer for four years, told Business Line. Jobs at the company could go if the new investor feels that there are more jobs than could do justice to projects in hand. After all, if the scam-hit company has inflated revenues, it could mean that there are more employees than are necessary.

In anticipation of losing jobs, some employees are already seeking opportunities elsewhere. “There has been a noticeable rise in the number exit interviews being done by the HR department,” an important Satyam official said.

Soon after news of fraud at the company’s helm broke out earlier this year, recruitment agencies reported a sharp rise in resumes, of Satyam staffers, suddenly appearing in their databases and in mass recruitment web sites.

“Even the top managers are also not clear about the continuity of their jobs after the completion of the sale process,” Mr Navin, a senior professional in the marketing department, said.

However, in the last four months the company has been in the news for the wrong reasons, attrition has not gone beyond industry average which is in the 10 to 15 per cent range. The reason could be lack of opportunities rather than belief in the revival of Satyam, he added.
The mood among Satyamites abroad is no different.

A Satyam employee posted in San Diego, US, said over : “Most of us here are trying to shift before something (unpleasant) happens after the sale. Some employees are in the process of joining client companies.”

Satyam's clients such as Coca-Cola (which has terminated a contract) and Bank of America have already hired some Satyam employees, though not in big numbers.

Satyam's competitors are also understood to be extending offers on selective basis.

Given the choice between joining clients and competitors, the trend is towards the former, because of the uncertainty perceived in other Indian IT companies, sources in Satyam indicated.

The company, however, has been able to pay salaries on time. For most employees, this helped in keeping hopes alive for a while.

The admission of the Rs 7,136-crore fraud by Satyam founder Mr Ramalinga Raju on January 7 has caused a big shift in the operational and management environment, employees said.

"Prior to January 7, 2009, there was much dynamism and a competitive spirit pervaded all levels, which is missing to some extent now,'' said Mr Ramesh.

While there is no lapse in the quality of deliverables and schedules, the work environment is marked by a lack of enthusiasm and optimism, he said.

Source: THE HINDU Business Line
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  • Dear friend,

    So far so good for both Satyam and the new owner Tech Mahindra.
    But in the matrimonial market, the value of unmarried Satyamites have gone down ?

    ks2071746
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  • Originally Posted by ks2071746
    Dear friend,

    So far so good for both Satyam and the new owner Tech Mahindra.
    But in the matrimonial market, the value of unmarried Satyamites have gone down ?

    ks2071746


    That's true. Satyamites will have a tough time in matrimony talks, unless they find their perfect match within Satyam/Tech Mahindra itself ;).

    I am also curious about the below for a while now.

    By acquiring Satyam, does Tech Mahindra also become owner of all Satyam owned real estate like Tech parks, SEZ etc in Hyderabad and other places?? That could be worth CRORES....Atleast one big banker has valued Satyam company owned real estate in Hyderabad alone at Rs.1400 crores.
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  • It looks like marriages are as described by KS and Contra a money matter and not about sharing life. Well I will think that is not marriage just .......
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  • Many IT companies are doing mass layoffs silently without any news in media.People working in IT industry know this very well.
    See below another layoff story reported in media

    From Economic Times

    CHENNAI: Consulting and outsourcing firm Capgemini has laid off nearly 100 employees at its Chennai centre. The pink slips were issued for
    employees mostly in the middle management positions. This comes on the back of reports that said Capgemini sacked 600 employees in Hyderabad and Pune.
    CommentQuote
  • Originally Posted by BigBear
    Many IT companies are doing mass layoffs silently without any news in media.People working in IT industry know this very well.
    See below another layoff story reported in media

    From Economic Times

    CHENNAI: Consulting and outsourcing firm Capgemini has laid off nearly 100 employees at its Chennai centre. The pink slips were issued for
    employees mostly in the middle management positions. This comes on the back of reports that said Capgemini sacked 600 employees in Hyderabad and Pune.

    Very soon these CapGemini fellows will start working for 5K p.m. along with the French imports, since they are probably only worth that much. Only then Sethugm will remember that his salary in 2004 was Rs 6384.97.
    CommentQuote
  • Originally Posted by BigBear
    Many IT companies are doing mass layoffs silently without any news in media.People working in IT industry know this very well.
    See below another layoff story reported in media

    From Economic Times

    CHENNAI: Consulting and outsourcing firm Capgemini has laid off nearly 100 employees at its Chennai centre. The pink slips were issued for
    employees mostly in the middle management positions. This comes on the back of reports that said Capgemini sacked 600 employees in Hyderabad and Pune.


    This is true. Capgemini has laid off people in Pune, Chennai and Hyderabad where they are mainly set up.

    When the recovery happens which will happen (the world is not going to end) Capgemini will not be preferred by any IT candidate in India due to job insecurity perception. Actually Capgemini is the one which is going to suffer in the long term as they are sending wrong signals to hundereds of IT professionals and students in India.

    As far as the laid off employees are concerned they will find jobs elsewhere and those companies would benefit.
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  • Dear friend,

    I thought Capegemini is a better IT company? I am getting proved wrong now? They are silently gving pink slips to the employees. If it is in the middle management level, the guys will find jobs elsewhere, may be at the existing salary or slightly less. However, I feel, the company is sending out mid level people with higher salaries and may take in new recruits at much lower salaries as a cost cutting measure?

    ks2071746
    CommentQuote
  • Originally Posted by contra
    This is true. Capgemini has laid off people in Pune, Chennai and Hyderabad where they are mainly set up.

    When the recovery happens which will happen (the world is not going to end) Capgemini will not be preferred by any IT candidate in India due to job insecurity perception. Actually Capgemini is the one which is going to suffer in the long term as they are sending wrong signals to hundereds of IT professionals and students in India.

    As far as the laid off employees are concerned they will find jobs elsewhere and those companies would benefit.


    Lay-offs does not send any wrong signals but its sending good signal atleast for Promoters/Investers. No company lay offs people affecting their operations but trim to the optimum size.

    If you feel lay-offs means wrong signal , then almost every other company has sent wrong signals or sending it.As per my understanding ,TCS is the only exception among the top 30 Indian IT Companies.

    The earnings per employee in Indian IT Companies has come down drastically from the earstwhile USD 50000 per annum to USD 40000 per annum in 2008. This can be directly attributed to the reduction in the billing rate charged from clients. If its fixed cost projects , the IT company itself will downsize its team both in on and off-shore.

    Laid-off will have serious troubles as the number is increasing heavily and they have to compromise atleast 20-30 percent of the previous salary save 5-10 % exceptions. As Tech Mahindra's only interest is Satyam's SAP division, 20-25 thousands Satyamites are increasing the number of potential job seekers reducing the salary bargain for others...

    Am of the opinion that had there been no Satyam chaos , the lay-offs could/would have been easily managed as people may find jobs somewhere else. Satyam personnel is making things worser though none is blaming them as its not their fault.Anyone has different opinion ?
    CommentQuote
  • Dear friend,
    Even without considering the Satyamites possible lay offs, the situation would not have been very much different. Many Satyamites may like to continue even with some cut in the salary rather than shifting to some other company as they may have to look for different city/ place / location etc. and relocating at the present juncture is not advisable. However, there is some truth in what you say that those Satyamites who may get pink slips are likely to affect the IT job market/salary structure, being large in numbers.

    ks2071746
    CommentQuote
  • Originally Posted by sethugm
    Lay-offs does not send any wrong signals but its sending good signal atleast for Promoters/Investers. No company lay offs people affecting their operations but trim to the optimum size.

    If you feel lay-offs means wrong signal , then almost every other company has sent wrong signals or sending it.As per my understanding ,TCS is the only exception among the top 30 Indian IT Companies.

    The earnings per employee in Indian IT Companies has come down drastically from the earstwhile USD 50000 per annum to USD 40000 per annum in 2008. This can be directly attributed to the reduction in the billing rate charged from clients. If its fixed cost projects , the IT company itself will downsize its team both in on and off-shore.

    Laid-off will have serious troubles as the number is increasing heavily and they have to compromise atleast 20-30 percent of the previous salary save 5-10 % exceptions. As Tech Mahindra's only interest is Satyam's SAP division, 20-25 thousands Satyamites are increasing the number of potential job seekers reducing the salary bargain for others...

    Am of the opinion that had there been no Satyam chaos , the lay-offs could/would have been easily managed as people may find jobs somewhere else. Satyam personnel is making things worser though none is blaming them as its not their fault.Anyone has different opinion ?


    What we are seeing now is just the pre-emptive laying off people by the IT companies who are not willing to compromise on their profit margins.They are using this lull as an opportunity to trim themselves, unload the excess baggage and get into better shape.

    I feel the greater problem is that clients are cutting down on their IT budget and spending, they are putting off new development and re-engineering projects. Job positions are getting abolished every day.

    More availability of people from satyam are just making things worse.

    Today companies hire one person to fill the vacuum created by the laying off 2-3 jobs.No new jobs are getting created.

    people who have lost jobs in the U.S. are unable to find one for 3-6 months now.No interview calls unless you are a resident green card holder.

    Every renewal/extenstion application of L1/H1B visa, is being scrutinized and majority being rejected.

    They dont want to R2I fearing ridicule, and are eating up their savings.They are scared to even come back home on vacation for a week.

    With country like U.S. which accounts for more than 60% of IT business adopts protectionism, Things are not rosy for Indian IT industry.

    For the first time in IT industry, We are witnessing survival of the fittest.Have to see how the mighty IT giants adapt and evolve.
    CommentQuote
  • Originally Posted by nabishek
    What we are seeing now is just the pre-emptive laying off people by the IT companies who are not willing to compromise on their profit margins.They are using this lull as an opportunity to trim themselves, unload the excess baggage and get into better shape.

    I feel the greater problem is that clients are cutting down on their IT budget and spending, they are putting off new development and re-engineering projects. Job positions are getting abolished every day.

    More availability of people from satyam are just making things worse.

    Today companies hire one person to fill the vacuum created by the laying off 2-3 jobs.No new jobs are getting created.

    people who have lost jobs in the U.S. are unable to find one for 3-6 months now.No interview calls unless you are a resident green card holder.

    Every renewal/extenstion application of L1/H1B visa, is being scrutinized and majority being rejected.

    They dont want to R2I fearing ridicule, and are eating up their savings.They are scared to even come back home on vacation for a week.

    With country like U.S. which accounts for more than 60% of IT business adopts protectionism, Things are not rosy for Indian IT industry.

    For the first time in IT industry, We are witnessing survival of the fittest.Have to see how the mighty IT giants adapt and evolve.


    Very well said nabishek.
    CommentQuote
  • Originally Posted by nabishek
    What we are seeing now is just the pre-emptive laying off people by the IT companies who are not willing to compromise on their profit margins.They are using this lull as an opportunity to trim themselves, unload the excess baggage and get into better shape.

    I feel the greater problem is that clients are cutting down on their IT budget and spending, they are putting off new development and re-engineering projects. Job positions are getting abolished every day.


    With country like U.S. which accounts for more than 60% of IT business adopts protectionism, Things are not rosy for Indian IT industry.

    For the first time in IT industry, We are witnessing survival of the fittest.Have to see how the mighty IT giants adapt and evolve.


    My view is that india will emerge stronger (particularly in IT)from this recession alongwith other countries which have the cost advantage.
    the western corporates priority is to cut cost and the IT industry here is already being proactive by cutting salaries and 'flab' and will be in better shape to offer better pricing to the cash starved MNCs
    the volkswagon- TCS deal may be a harbinger of this.overall india will stand to gain from this recession in the long run
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  • The biggest IT company in India TCS is still a $5 Billion Company. IBM the largest IT company in the world is a $100 Billion company. See the difference.

    IBM has increased the headcount in India quietly to 70,000 now which is more then Cognizant. Even if IBM increase headcount by another 60-70% it will beat Wipro, Infosys and TCS to become largest IT company in Indian soil also.


    This shows 2 types of oppotunities

      Bigger MNCs like IBM, Accenture, HP which still have 60% staff in high cost locations have a lot more offshoring to do. No Client is a fool to pay $85-$100 per hour for a job in US if it can be done for $25-$32 in Chennai or Bangalore. (In my billing rate example I have taken rates of high end skills like Middleware,etc under current market conditions).
      Indian IT companies are still kids friends when you look at global market where IBMs and HPs are real giants. So Indian IT companies still have a lot to grow and they have to hire even more freshers every year.
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  • lol... bookmarking this page.. will revisit this page again in 6 months! what fun!
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  • Satyam to lay off 12000 to 14000 folks. News in rediff. I'd known this via unofficial means. One of my relatives has been affected because of this.
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