'Clients says India knows how to handle the downturn'

Bangalore-headquartered Wipro has had much work in the uncertain global environment to meet its fourth quarter targets. Girish Paranjpe, joint CEO of its information technology business, talks with Bibhu Ranjan Mishra on plans and outlook. Excerpts:

Your clients have finalised their budgets. What messages are you getting?
Their willingness to spend is, every month, looking better than the previous month. Budgets have been cut by many, no question. But while it reduces the overall pie (of IT spending), clients become more careful about how to spend the money. They feel talking to us (Wipro) is more helpful than talking to some of our global competitors.

What are they asking?
Expecting us to take more responsibility, be more creative in structuring the deals. They also want us to help them meet their budget goals, getting the desired results despite spending less.

Is this helping you?
Yes, this is a good sign. One concern many clients had about the Indian (IT) industry is whether India is becoming uncompetitive. They were telling us, “You are increasing salaries by 10-15 per cent every year. So, at some point you will just become unaffordable.” They are now saying India knows how to handle the downturn, and that Indian IT industry can be flexible on the wage side.

So, will there be no wage hike this year?
We have already decided not to.

Any salary cut?
No. There might be some impact on variable pay. It ranges between 10-15 per cent for younger people and is as high as 40 per cent at the senior level.

You have recently asked people on the bench to come to office for two days (in a week) and take half the salary.
We found value in people being given flexibility instead of asking them to come to work when there is no work. We have also given them a choice of coming to office 10 days at a stretch in a month, rather than coming two days every week. They can work that out with their administrative heads. About 1,000 people have opted for this scheme. It’s only for the bench people, who are now 10-12 per cent of overall employees. It is better to keep a tight bench and keep everybody fairly engaged.

What is your hiring outlook for FY10?
First, we want to take all the graduates to whom we made offers in 2008 and 2009. About 10,000-15,000 people are there. Only after we get all these people inside, if we see some pick-up in demand, then we will think of going to campuses.