Software services firm Tech Mahindra has sacked thousand odd employees this month joining peers such as Wipro, Infosys and Cognizant to trim workforce as they face their worst business crisis in nearly a decade.
Indian firms are witnessing their slowest growth in a decade due to automation, technology shifts and increased protectionism in its main markets. Global firms are shifting their budgets from traditional IT services to newer areas such as digital and cloud, which requires engineers to engage clients than work remotely. Also, low end maintenance work is increasingly automated forcing companies to shift them to other projects and reduce hiring from campuses.
With growing stress on their business, IT firms are also increasing scrutiny on performance of employees and weed out non performers.
"We have a process of weeding out bottom performers every year and this year is no different," a Tech Mahindra spokesperson said.
As on December 31, 2016, the company's total employee headcount stood at 117,095, while software division had 80,858 employees.
Industry experts say that mid-level employees with 10-15 years of experience may be largely affected as many of them are averse to unlearning and getting new skills.
More software services firms struggle to deal with challenges such as slow-paced growth in business, changing client demand with more outcome-based business and immigration issues across different markets including the US.
Bengaluru-based Wipro said it "undertakes a rigorous performance appraisal process on a regular basis to align its workforce" and continued it this year. The company, however, did not specify the exact number of affected employees.
Cross-town rival of Infosys is in the process of tightening performance metrics and around 1000 people may have been impacted after the the bi-annual assessment.
Infosys said it has taken a similar exercise for mid-level professionals to scrutinise their performance when the company is shifting its focus on automation and delivering software-led services to its clients. "A continued low feedback on performance could lead to performance actions, including separating an individual," said the company in a statement.
