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'New technology making employees obsolete'

July 05, 2016 16:35 IST

Indian IT players, over the past few years, have pressed the paddle on re-training of their employees as new technologies take centre-stage.

Attrition is not always about employees leaving a company for better prospects but also about people not being able to keep pace with the technology, leading to “involuntary attrition”.

A M Naik, chairman, Larsen & Toubro and non-executive vice-chairman of L&T Infotech said the 18.5 per cent attrition rate of the information technology (IT) services company does not represent just “voluntary attrition”.

Actions taken by management to terminate employment are grouped under involuntary attrition. 

“Over the years, we have continuously become more efficient by use of technology and various tools. As we hire talent that caters to new technology, some of the people cannot cope with such changes. So, the 18.5 per cent attrition does not represent voluntary retirement or voluntary resignation. Rather, less than 12 per cent of people normally leave voluntarily. The rest become obsolete, either due to inefficiency or due to lack of technological knowledge,” said Naik during the L&T Infotech IPO press conference.

Indian IT players, over the past few years, have pressed the paddle on re-training of their employees as new technologies take centre-stage.

For instance, Tata Consultancy Services, the country’s largest IT services provider, is training 100,000 employees on digital technology.

Similarly, Infosys had announced it would train 40 per cent of its workforce on design thinking.

According to L&T Infotech draft prospectus, the company’s attrition for the FY15 was 18.5 per cent. L&T Infotech will launch its IPO on July 11, with the price band at Rs 705-710.

Naik also refuted that the senior management team at L&T Infotech has been unstable.

“I do not think that in the last few years senior people have left. Sudip Banerjee, CEO from 2008-2011, left as he could not travel. Now, he has joined the board of L&T Technology Services. After that we had two people at helm - one of them left as he could not cope with the changing times. And the second person wanted to leave as he felt he was good at managing relations but not at closing deals,” he said. 

After the resignation of Banerjee in 2011, L&T Infotech had appointed Vivek Chopra and Mukesh Aghi as chief executives. Both quit in 2014.

In March 2014, Chandrasekar Kakal had joined L&T Infotech as COO, reporting to V K Magapu, managing director of the company.

Sanjay Jalona took over as CEO & MD of L&T Infotech in August 2015. Before this, he was with Infosys.

Shivani Shinde Nadhe & Sheetal Agarwal
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