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Online marketplace Snapdeal has put around 200 employees on notice. These workers have been asked to undergo a 30-day performance improvement plan (PIP). Their performance during this period will decide their fate in the company, sources say.
According to sources, the Gurgaon-based company has been bogged down by constant pressure to stay on top in the face of stiff competition from other marketplace giants such as Flipkart and Amazon India, forcing it to crack the whip on poor performers.
Sources said those not meeting the criteria set under PIP might be asked to leave or get transferred. The employees have been zeroed in based on their performance of the past six months.
"This is the first time this sort of review is being done at Snapdeal. Some employees, according to the company's internal review, have not been doing well. The company has zeroed in on 200 and asked them to improve. The company has made it clear that the non-performers would be asked to leave. However, no one has been fired till now," said a source close to the company.
This move has had an adverse effect on Snapdeal's employees. Sources in the know of the developments said that while some of them openly protested saying they were singled out, many chose to put in their papers.
Snapdeal has around 8,000 employees, which is less than one-fifth of its biggest rival Flipkart's total employee strength of 45,000 employees.
Snapdeal, however, maintained that employees were quitting voluntarily and no one has been laid off as of now.
"There have been no layoffs at Snapdeal. As part of the on-going performance management and development programme, some team members at our contact centre have been offered PIP. While many team members have opted for this opportunity to improve the requisite skills set, some team members have desired not to undertake this and have instead decided to move on voluntarily," said a company spokesperson.
This is not the first time an e-commerce firm has taken such a step. Last year, online restaurant search firm Zomato had laid off as many as 300 people. Right after that, its co-founder Deepinder Goyal sent a strongly-worded mail to its sales team in which he lambasted his sales team and painted "the real picture" of the company's performance to them.
However, after breaking even in six markets this year, Goyal said laying off 300 employees had nothing to do with Zomato's performance. "It was a way to make our operations better. Many were given a choice to join other teams; some took it, others did not," he said in an earlier interview to Business Standard.
Similarly, TinyOwl had shut down offices in four cities and laid off 300 employees in mid-October last year. Foodpanda, too, laid off 300 people.
Snapdeal till now has partnered with several global marquee investors and individuals such as Ontario Teachers' Pension Plan and Singapore-based investment entity Brother Fortune Apparel, SoftBank, BlackRock, Temasek, Foxconn, Alibaba, eBay Inc, PremjiInvest, Intel Capital, Bessemer Venture Partners, and Ratan Tata - chairman emeritus of Tata Group, among others.