What is happening in Indian Software Industry ?

Recently two news on economic times caught my attention. First one is “IBM has dismissed 700 freshers” and the other “TCS will cut salaries of his employees”. So now the big question is what is happening in software field, is software boom over? The honeymoon for software professionals has ended. I am also worried as I am part of this big community of computer science graduates. Now let’s discuss the pros and cons of both the news.

IBM has fired 10 percent of 7,000 entry-level trainee programmers, or ELTPs (freshers) it hired over the past year as part of its aggressive growth strategy in the world’s biggest democracy. Angry anti-IBM comments are flying across the Net for all the world to see. And many freshers are worried that being fired by IBM ruins prospects for future employment.

India’s largest software exporter TCS is going for 1.5 per cent cut in salaries of its over one lakh employees in the fourth quarter, as it fell short of certain financial targets. TCS’s Economic Value Added (EVA) for the third quarter was slightly short of target, which has forced it to cut down the salaries.

One of the big reasons for all these happening is our Indian Rupee. Rupee has appreciated about 14 per cent against the US dollar in the last one year. Now the profit margin for the software companies has decreased as a large section of our software industry is dependent on American market. We can’t forget the economic crisis after 9/11. Is history going to repeat ? What will happen to large pool of software engineers especially college freshers is a big question mark.

Let’s come to IBM. According to this company “India is at the heart our services strategy which has grown from a 53,000-employee organization in 2006 to 73,000 in 2007. We continue to hire people with skills that meet our client needs and business demands”. Now see what they are doing ? Instead of good salary they are giving pink slips to innocent freshers. The reason for this firing is some aptitude test conducted inside the company. Then what about the whole recruitment process, those written test, technical & HR interview. Are they waste less or they were just joking or make fun inside the college campus. It is nothing but wrong estimation. They did wrong estimate for the work/projects expected and hire more people and realize that they had done it wrong and fire few people.
For this I would appreciate TCS, because it has cut the salary and not fired like IBM. They are just playing with the careers of those 700 guys. I fully sympathize all 700 innocent engineering graduates who lost their jobs due to poor planning and brainless HR people action. It is unfortunate to companies like IBM so barbaric at innocent intelligent engineers.
I am confident all these guys will very soon get a new job but by doing such a irresponsible act, IBM has lost its reputation in India. Now every fresher will think twice before joining IBM.

Thumbs down for IBM, cheers for TCS for taking good decision

Abhishek Kumar is a computer science graduate.