Secret to Wipro's success
20 Oct 2006
People, people, people- that's the secret to Wipro's success it seems. CNBC-TV18 reports on how a hiring policy has helped Wipro improve profitability.
Faced with ballooning salaries due to shortage of skilled people, Wipro is trying a new ploy — of the percentage of people less than three years experience has gone up. And that has brought down the average cost of compensation. We don't want to be granular in terms of data points but yes it has improved. That's why I have tucked it under operational efficiency. And this has helped to mitigate the cost pressure we had."
Company officials also say the new trend doesn't impact quality. It has hired about 5,382 employees during the quarter. And plans to add almost an equal number in the coming October-December quarter and, the total wage bill will only have a 2 per cent impact on overall margins. However, the point of concern is that resource utilisation parameter fell by 3 per cent.
Azim Premji, chairman, Wipro, said, "The margins are running at about 22 per cent. And I think we should be able to sustain these margins if not improve on them."
Official's say most of the growth will come from volumes. They expect billing rates to remain stable or even rise a tad. The bulk of the projected 7.5 per cent growth in revenues is likely come from higher volumes of business and a controlled wage bill. That's what Wipro is betting on.
