At a time when, Wipro and its IT services rivals such as Infosys, Cognizant and HCL Technologies lose talent to each other and to captives of multinationals who are expanding in India to build digital capabilities, Wipro looks to introduce a new policy to curb attrition.
Under the new initiative, Wipro will pay a one-time bonus to junior employees who have remained with the company since they have been hired from college campuses. This would also include engineers who have expertise in skills in new areas of digital and cloud, business segments that are growing for Wipro and across the industry.
The company will give a percentage of their total pay as a bonus with the January salary, primarily to employees in the B1 and B2 bands. However, to avail this benefit an employee needs to commit to staying at the company till 2020.
Wipro employed 1.75 lakh people as of September end and as a good number of them were at the bottom of the hierarchy with 1 to 5 years of experience, the move will have an impact on many of them.
Wipro's competitors in the industry such as Infosys and Cognizant have also introduced similar initiatives in the past. While Infosys has started programs to enable employees to learn skills and allow them to be consultants with a commitment that it will double wages for those who successfully complete them, Cognizant is looking to offer a quarterly promotion to people with newer skills.
As attrition remains a major challenge for the industry, incentive programs act like instruments to retain high-performing talent. Infosys and Cognizant saw attrition at 20 percent in the six months through September, while Wipro's attrition remained at around 18 percent during the first half.
It is often the low pay package for junior employees’ that makes them switch jobs even for a less hike in salary, resulting in higher attrition. Considering this, an incentive program may help Wipro in retaining its key talent at the junior levels.
However, as the entire Indian IT services sector battle for talent how far these initiatives are able to help firms in retaining talent is to watch out for.