India's Perk Pampered Techie Workforce

With their swimming pools, tennis courts and even zoos, the campuses of many Indian high-tech companies have more in common with a country club than the average office block.

But perks like these, along with talent contests and even letters to parents, are becoming vital weapons in the HR armory for Indian tech companies desperate to hold onto their best staff.

Much of the success of the Indian services companies to date has been down to the vast talent pool that they can draw on. But hiring--and keeping--the best people is a constant struggle and the top tech companies are getting increasingly sophisticated about how they reward and retain staff.

As use of offshore increases, so does the need for staff to service those deals. The big players--led by Infosys, TCS and Wipro--hire several thousand new staff every quarter in order to keep up with demand.

And even though India is renowned for churning out 300,000 engineering graduates every year, there is still fierce competition for the best. Because despite the huge headline figures, only a subset--say 25 percent--of those graduates are immediately employable.

And keeping hold of the best people once they are hired is just as big a problem.

As a recent McKinsey report stated: "There is almost a frenzy in India to find senior staff to keep more complex projects on track. In this scenario, resource management is a competitive differentiator."

Across the big players, attrition rates (the proportion of staff quitting each year) run at around 14 percent in IT positions but can run much higher in the business process outsourcing sector. Staff with one to four years' experience are the ones most likely to move jobs, many lured away by glamour postings in the United States and Europe. And this means companies have to get clever about how they attract and retain staff.

Pay, of course, is one way to keep staff happy. The lower salaries--particularly for junior staff--are one of the incentives to use Indian outsourcing in the first place but these are rising.

For example, recruits with engineering degrees might be paid somewhere between US$3,000 to US$7,000 per year. But these salaries rise by about 20 percent per year and someone with five years' experience might be earning US$20,000 to US$25,000. The further up the organization, the less of a difference there is between Indian salaries and those in the United States and Europe--for example a senior executive might make somewhere between US$100,000 and US$150,000.

On top of pay, companies are looking at ways of boosting loyalty through softer hearts-and-minds style programs.

Most of the large companies have luxurious campuses where staff can swim, play golf and even visit the zoo. Recently Wipro, for example, held the grand finale of its 'Spark' program, which was a day-long sports event and family entertainment day held in a stadium in Bangalore.

HCL has even gone for the approach of employee first, customer second. S Premkumar, HCL's head of financial services explained: "We believe that the value we generate is generated by our employees."

Hari Thalapalli, human resources director at Satyam, explained his approach: "We recognize that we can't hope to stop attrition completely. So we say we don't want to lose people at a leadership level."

Satyam targets the top 30 percent of staff at every level and gives them perks--like first refusal on new projects and regular exposure to new technologies and industries--and claims to have reduced attrition to five per cent in this group.

Thalapalli said the company also runs a talent competition, even writing letters to parents and partners of staff telling them "they have made a significant difference to the company".

It also tries to keep in touch with people who leave the company. The company's vice president of leadership development, Ed Cohen, said: "There's a high percentage of people at Satyam that leave and come back--how you exit people is becoming as important as how you recruit or retain."

Of course, there are different pressures in different parts of the market. In the call centre space, staff attrition can run at 80 to 140 percent per year, which means a company might have to replace its entire workforce every year.

Souvik Chakraborty, managing director of recruitment company CAPntel, said the growth of IT means some top techies try to demand massive salary hikes when moving between employers. "The expectations are pretty ridiculous," he added.

BPO has meant a big change for graduates. He said: "For a plain undergraduate for whom getting a job would be a big challenge, BPO has changed the whole scenario. Now they are not just getting jobs, they are getting multiple offers."

There are also other reasons for the fast turn over in some BPO areas, as Venkatesh Roddam, CEO of BPO company Nipuna--part of Satyam--points out: "The call centre employee's job is scientifically rated as the most stressful in the world." After all, who wouldn't find it stressful if they were to deal with complaints all day?

On top of this there is big demand for good workers. He added: "The market is buzzing with opportunities for people today. These are youngsters that are becoming extremely employable in the call centre space."

As a result, Nipuna has a chief fun officer who is tasked with keeping the atmosphere vibrant. And BPO operations regularly latch onto celebrations such as Valentine's Day and have themed days in the office.

The next trick, of course, is to make sure the clients are as happy as the staff. And that can be a little trickier than just laying on a pool as an after-work treat.