Saturday, March 15, 2008

I've Been Fired!!

That is what many people in the Indian IT industry will be saying this year according to The Times of India. The recent months has not been good for the Indian Techie. The feel good factor of being in the IT Industry has diminished for many, even gone for some. Recently about 1800 or so employees were fired within the span of a week from companies like TCS and IBM, or at least the news of firing from both the companies was reported within a week of each other. Yahoo India's firing of their employees and giving them just half an hour to pack their things and leave the premises was one of the points of discussion among techies in Namma Bengaluru and elsewhere, over coffee, lunch or the much awaited break for a smoke. Even people who are safely employed are not very optimistic. "Don't expect a good hike this year. IT Industry is in a slowdown.", a colleague warned me."Something to do with some sub-prime crisis in the US. The US economy is also heading into a recession." I expect to hear something similar maybe when I have my discussion with my employer regarding the annual hike.

You know the situation is bleak when instead of hearing news about people you don't know, you hear news about people you know (including you). One of my friends was told that his services would not be required after March when the client for which he was working decided to close the project ( The client was severely hit by the mortgage crisis.) Thankfully, he got another job with a better pay. But not everyone would be as lucky as him. What about the people who were fired by IBM and TCS? Many of them were not freshers but people in the middle management. To get fired at such a point in your career! This is new for many of us Indians. And what about the hundreds of students who are joining engineering colleges in the hope that someday they end up in TCS, Infy or Wipro? Colleges like Vellore and Manipal have increased their intake by great numbers in the past few years. Since more than 90% of the students used to get placed in companies and with newspapers carrying reports of shortage of skilled IT professionals the bodies running these institutions decided to cash in on the gold rush. I being an alumni of Manipal am still in touch with some of my juniors and hear how the college has changed. From almost 800 students graduating in 2006, about 2000 are expected to graduate in 2012! What a phenomenal increase, but what about placements. Will the services companies like TCS and Infy still continue to hire in the same way they used to until now. With already there being a lot of talk about cost cutting and reducing or even in some cases eliminating the bench strength of these companies, I doubt that they are going to be in a hiring spree they were in over the past few years. The bench strength no longer remains a strength but is a turning to be a liability.

In fact, at a placement party in college a friend observed how great it was to be passing out when the placement boom was there. Another guy agreed, but said he failed to understand why were companies hiring so many people when they had so many people on bench, to which he got the response "Why the hell do you care! Be happy you got placed and enjoy the booze." While all of us certainly enjoyed the booze, we did wonder time and again what the rational was behind this bench policy, because it didn't have any common sense element to it.

While attending an ITIL foundation training I sort of understood what the management of these companies thought. Most of these companies provide Services to their clients. They have a Service Catalog or a list of services which they currently provide and a Service Pipeline or services which they plan to offer in the future. When designing your service you take a lot of factors into account. One of them is the availability of resources to accomplish your tasks. In the tough and competitive world today service companies cannot wait for a project to come and then look for resources. You need to be resource ready. That is one of the things that these companies show to their clients when they bid for projects, or at least that is what I have heard of. It does make sense for me as a client when you show me that you have 100 people who are trained and ready to fulfill my company's service requirements. But all these service companies in my view never anticipated a slowdown like the one that we see, which is the reason why they are in this situation today.

I have an analogy for this. In your growing years, say you need a certain intake of carbohydrates and fats, the intake varying over the years, less at first and increasing as the years go by, for you to grow into a well nourished person. But if you start eating extra food at the age of 10 saying that anyway you will be requiring this extra diet at the age of 17, what is going to happen? You will turn into an unhealthy and obese person, your extra diet now a liability. That is exactly the situation these companies find themselves in today, looking for ways to shed the extra fat in their skins.

So far this post has been depressing. What is going to happen? Well, I am not worried by the slowdown and neither is Bill Gates. He said in the past week that conditions were very favorable for the technology industry to grow in the next decade. I agree with him completely. If you are excited about the Apple i-phone and the upcoming Microsoft Surface and how the world is going to be a different place in the years to come, you have to see the video on Morph, a concept by Nokia based on Nanotechnology.

But what about the Indian Techie? I know many people in the services industry who are plain and simply bored of their jobs. Many of them feel that their engineering and analytical skills have been wasted doing the job that they are doing, mostly writing emails and filling excel sheet status reports. What is going to happen when there are highly talented and amibituous people with experience in the industry but no path which satisfies them? Some, not all but some, of them are going to be the contributors to the technological development that Bill Gates has talked about. When the dot-com bubble burst in the 1999/2000 era there weren't many options in terms of Open-Source software which could be used in production level environments. But now you got so many flavors of Linux and Open Source databases like MySQL and PostGRESQL! Even Sun Microsystems now follows an open source model. In 1999/2000 you needed to pay for this stuff. Now its available for free making it a lot easier for anyone to get their company up and running. The environment exists today for people to concentrate and invest on their core competencies and deliver better products and services and not worry about investing valuable dollars just for software like Microsoft Office. I read an interview of the founder of Juniper Networks where he said that post the 1999-2001 slowdown you could hire a lot of talented people at very low salaries making it the best time for his company to expand. Is a similar time coming in again?

We have already seen this year the launch of products designed and developed in India. Tata Nano has created a buzz worldwide. (Even though I tried very hard, I can't remember when was the last time something like that happened!) Spice has designed a new mobile phone which will cost less than $20. Are we going to see similar innovative products in the field of software and technology? Well, only time will tell, but I have a hunch we could have something in the making here!

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