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TCS plans salary hike after 2 years & how that could tackle attrition?


TCS plans salary hike in April this year. They are currently looking to recruit 30,000 people in  the coming financial year which is a very positive sign indicating that the recession is slowly receding. Once the market is coming out a recession, big companies or even mid-sized companies should also have a check on the attrition rate in the company.

The last time TCS staff received a salary increment was in April 2008

For any company big or small, a healthy attrition rate is recommended. More importantly retaining top performers in a company becomes a challenge.The challenge gets bigger as the company size increases.Ideally, a healthy attrition rate for a company is 10% for a company. It is always good to have somewhere around 10% because it will infuse fresh employees into the company.

In the third quarter of the current fiscal, attrition rate at TCS declined to 11.5 per cent, as compared to 13.2 per cent in the sequential quarter.

In an IT environment, typical shelf life of an employee is 5 years. In this 5 years of time, a top performer would have been promoted a couple of times with an enhanced responsibility every time he gets promoted. So after a point , there would come a saturation point either for the company or for the employee. That means there comes a time where the top performer could start taking him for granted or for that matter the company taking the employee for granted. So a healthy attrition is always good

Compensation was a major factor to tackle attrition. “However, beyond that performance-related abilities also matter.” The company’s attrition rate is 11.5 per cent.

TCS has been one of the ultimate training companies in the Industry. Most of the today’s corporate managers and leaders would have had a corporate connection somewhere or the other with TCS. It being a very huge company, attrition is very natural and the present attrition rate is close to healthy and thats a good sign. But the smaller companies should be careful because as the recession is receding , the top performers in their company might eye for a bigger brand. So when the economy is slowly going up , the smaller companies should have to taclke attrition.

About the Author


T. Muralidharan

(Promoter, Founder & Chairman), TMI Group

He is a first generation entrepreneur. An IIT IIM Alumni, he visualises on a grand scale and articulates his vision most persuasively. Be it the ‘The Manage Mentor’- A Continuous Professional Educational (e-CPE) tool for practicing managers) or Be it the ‘Jointly Owned Job Oriented Education’ (JOJOE) – Model of recruitment, which promotes earning while learning his team typically achieves outcomes beyond other competing organizations.He has been one of the more active members of the IIMA Alumni Association, Hyderabad Chapter and currently serves as the Joint Secretary of the Association and the President of The Learning Forum.

TMI Network is India’s leading Recruitment Advertising agency and a top 5 recruiting firm.

Posted in Talent & Skill Development.

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