Despite better-than-expected results, Infosys managing director Shibulal, maintains that the environment is volatile and client confidence is low. Excerpts from the interview:
Does this good quarter suggest worst is behind?
We had good broad-based growth and deal wins in this quarter. But, we are operating in a challenging environment. Client confidence is low and environment is very volatile. Even if the budgets are closed there is a possibility that they may scrutinise revisit and on a quarter-on-quarter basis. We definitely remain cautious.
We hear a lot about the pruning of staff strength that you initiated, can you clarify?
There are two parts of this story. If we look at in absolute numbers, attrition has come down quarter-on-quarter from 5300 to 4500. There is a substantial reduction in attrition. But performance management is very important for Infosys. We maintained that under-performers should look at other opportunities.
What about deferment of appointments?
Last quarter we deferred joining dates of freshers by three months. So, actually we have close to 2,000 people who are going through e-training. The first batch will join soon.
Does all these suggest that the business has slowed?
Our plan for this year was 10% growth but that won’t be possible. This means, we have to re-adjust our hiring plan and cost structures. We have only 71% utilisation compared with 78%-79% utilisation, which we are comfortable with. All of this means that we had challenges this year.
Going forward, what is yourhiring plan?
We had given offers for 6,000 freshers this year. For the next year, we have not finalised yet. We hire from market every quarter. This quarter we will hire 2,500 laterals from India and 500 laterals from outside the country.
This time your India business showed 44% growth. What is the prospect of your domestic business?
We have definitely focussed on India but it is a very small base. We expect it to grow above company average. The long-term perspective is good. Most of our business is with government; we have not even explored the private sector. We will continue to expand.
We started bidding for deals in India only about 3-4 years back. We have chosen a platform-based approach to the domestic market and it is very successful. In fact, one of the eight large deals we closed this quarter, was from India. Earlier, we had post office deals.