With Murthy at Helm, Attrition Rate Up to 18.7%
The exodus in IT major Infosys is not limited to top level management but also with the other staff as the company reported an attrition rate of 18.7% in the fourth quarter of FY14 against 16.3% in the same period last year.
Attrition levels were 18.1% in the third quarter of FY14. Recent exits, which include former head of Americas Ashok Vemuri and former CFO V Balakrishnan, had raised concerns among investors. In the last two years nearly nine top level exits have taken place in the company. The exits were mostly attributed to the return of co-founder of Infosys NR Narayana Murthy as executive chairman.
However, incumbent CEO and MD SD Shibulal downplayed recent exits. He said that they had close to 1.6 lakh employees and at least 1% (appox 1,600 people) of them were trained for leadership roles. Stating that “one or two people leaving” will not cause any real impact, Shibulal said that there was nothing “abnormal” in these developments as they were part of any company’s life.
The company, however, is luring staff with compensation packages, promotions and other sops to keep them from leaving the company. “We have increased salaries. We have given salary hikes of 6-7% for offshore and 1-2% onsite employees, effective April 1,” Rajiv Bansal, Infosys CFO said.
The company added 10,997 employees (gross) in Q4 FY14 and nearly 40,000 employees in FY14 to take their total headcount to 1,60,405. “This is the second time we are giving compensation increase over the last nine months. Nine months back, we had given a compensation increase of 6-8% offshore,” SD Shibulal said.
When asked about his own decision to leave the company before his superannuation, Shibulal said that he was only trying to bring more ‘clarity’ and ‘remove uncertainty’ as the search for the new CEO is underway. On his legacy, he said that he took over the company in challenging times as the company was facing internal and external challenges.