Given that the IT sector is hugely dependent on its manpower, it becomes imperative for these companies to question their productivity in times of trouble and tweak policies for desired results. Wipro might be leading the pack with its new variable pay strategy where employees will receive variable pay depending on their personal productivity and not the company's.
An Economic Times report said the junior staff in the company will have to clear customer satisfaction surveys once a quarter to be eligible for the variable pay which forms 10-12 percent of their salary. The company has not spared its middle management from the scrutiny either. The middle management will be responsible for rampant industry problems such as attrition and customer satisfaction and company's overall performance.
This move comes at a point when IT companies are plagued with problems as on the one hand wage hikes are eating into their margins and on the other the clients are demanding pricing discounts. The companies are constantly looking to tie up revenue per employee, industry parlance for individual employee performance to the company's balance sheet.
For the quarter ended in 30 June, all the key IT players have seen attrition stay above 10 percent. While not all factors responsible for this are internal, companies are still reviewing employee productivity.
"Turbulent economic conditions call for innovative HR policies. We, as a country were very resistant to the concept of variable pay but this is here to stay and is now an accepted norm," Kunal Banerji, CEO, Abolsute HR, Bangalore-based recruitment consultancy told Firstpost.
Companies are now realising that utilisation, which determines people working on live projects is not the same as productivity. "Productivity is a question within the utilised bunch. Companies will definitely benefit from this. But it also means that everyone will have to pull their weight," Sundarraman Viswanathan, engagement manager at Zinnov, a Bangalore-based IT advisory firm told Firstpost.
Experts say that companies are also investing in tools to measure productivity of employees by deploying software that keeps track of an employee's online activity. They are also deploying the unutilised bunch of employees, commonly referred to as bench, on internal projects such as building solutions for HR, working on cloud projects etc.