Friday, January 29, 2010


Oracle to cut 1000 jobs at Sun

Oracle Corp CEO Larry Ellison cheered the closing of his company's $7.4 billion acquisition of Sun Microsystems on Wednesday, vowing that Sun will immediately add to Oracle's profits.

He said layoffs won't be as severe as some industry analysts were predicting. Analysts had expected Sun to suffer huge job cuts once Oracle closed the acquisition. But Ellison said Oracle wants to bulk up Sun's staff to improve its sales -- a problem Sun has had trouble cracking since the dot-com meltdown a decade ago.

Oracle is hiring 2,000 people over the next few months for the Sun businesses, while layoffs from the acquisition will be about half that number, Ellison said.

"We're hiring, not firing. We're not cutting Sun to profitability," Ellison said at a conference with industry analysts at Oracle's headquarters here. "We think Sun's a growing business."

Ellison also confirmed that he's interested in buying the Golden State Warriors basketball team, a prospect that had been rumored.

"I'm trying," he said, in response to a question. "Unfortunately you can't have a hostile takeover of a basketball team." The line that got laughs because Oracle is a highly acquisitive company and won a bruising hostile takeover fight for rival PeopleSoft, a $10.3 billion deal Oracle closed in 2005.

Ellison had previously expressed interest in buying an NBA franchise and could take the Warriors if current top man Chris Cohan eventually decides to sell.

Oracle said Wednesday that it completed the Sun acquisition, one week after the European Union offered its long-awaited approval of the deal. European regulators determined the combined company would not harm competition in the database software markets, where Oracle dominates but a Sun division is a growing rival.

Sun was a dot-com highflyer that advanced the technology used to link computers, making them more useful as a network.

The deal with Oracle was announced last April. The US Department Justice cleared it four months later. With Sun, Oracle gets ownership of the Java programming language, which runs on more than a billion devices, and the Solaris operating system. Oracle also gets sophisticated server technology that it can bundle with its software. Sun is the world's No. 4 server maker.

One reason job losses may be limited is the fact Sun has already cut deeply because of its sagging finances. In October, Sun revealed plans to cut up to 3,000 jobs as the antitrust scrutiny dragged on. Sun has already cut about 7,600 workers in three previous rounds of layoffs.

Sun had 27,596 employees at the end of September. Previous Oracle acquisitions have been followed by deep job cuts.

Oracle fired some 5,000 workers after completing the PeopleSoft deal. Many of the layoffs came from PeopleSoft's 11,000-plus work force. The next year, Oracle cut about 2,000 jobs after absorbing Siebel Systems Inc, a company it bought for $5.85 billion and had 4,700 workers.
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No threat to IT Inc from Obama: Gartner

IT analyst firm Gartner dismissed any threat to the over $60-billion Indian IT exports industry following US President Barak Obama's plan to stop giving tax breaks to those US companies shipping jobs abroad.

"There is no need for panic...Even if tax breaks are taken away, the US firms have to outsource because that makes business sense for them," Gartner senior research analyst Diptarup Chakroborty said.

"If the tax breaks are taken away, it is not going to impact the Indian IT industry adversely. With the global economy looking up, a lot of emerging markets are opening up. The contribution from those markets is going to offset the impact of tax breaks if any," he said.

As the overall market would be growing the problems of tax breaks will be overlooked by the firms. The software firms association Nasscom also has sought to downplay Obama's plan to slash tax breaks for companies shipping jobs abroad, saying the real worry is "protectionism" and not tax breaks.

"I think the concerns that we have is about indirect protectionism. I don't think tax break issue is really the one which is important for us. Obama's comment was not related to outsourcing. It's about US companies operating in regions where they get tax benefits," Nasscom VP Ameet Nivsarker said.
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HCL Tech bags Rs 231 cr Meggitt deal

Software company HCL Technologies today said it has received a contract worth around Rs 231 crore from UK-based defence equipment maker Meggitt for providing engineering services.

Meggitt signs $50 million (around Rs 231 crore) global engineering transformation services agreement with the company's engineering and R&D services (HCL ERS) division, HCL Technologies said in a filing to the Bombay Stock Exchange.

"HCL integrates the right capabilities and business models to ensure organisations such as Meggitt establish a competitive advantage," HCL ERS Senior VP and Global Head of Sales & Practice Sandeep Kishore said.

HCL was selected based on its understanding of Meggitt's business challenges and proven track record of partnering with large aerospace and manufacturing companies on highly complex engineering development programmes.

"This strategic initiative will help us respond to the current economic environment while successfully positioning us for future growth," Meggitt's Chief Executive Terry Twigger said.

Meggitt PLC is an international group operating in North America, Europe and Asia, known for its specialised extreme environment engineering. Meggitt is a leader in civil and military aerospace equipment, sensing systems, combat support and defence systems training.

Microsoft profit up 60% to 6.7bn

Microsoft Corp. said Thursday that earnings in the most recent quarter jumped 60 per cent, helped by a rebound in personal computer sales.

The PC industry bounced back during the 2009 holiday shopping season after one of its roughest years to date. Microsoft's earnings are closely tied to computer sales because its two most profitable divisions make the Windows operating system and Office business software.

Microsoft said its net income for the fiscal second quarter that ended Dec. 31 rose to $6.7 billion, or 74 cents per share, compared with $4.2 billion, or 47 cents per share, in the year-ago period. Revenue increased 14 percent to $19 billion.

The latest version of Windows, called Windows 7, was released during the quarter. Revenue from the Windows business jumped 70 percent.

Shares of Microsoft rose 25 cents, or 0.9 percent, to $29.41 in extended trading after the release of results. Earlier, shares closed down 51 cents, or 1.7 percent, at $29.16.
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Wipro in outsourcing deal with BAT

No. 3 Indian software-services firm Wipro Ltd said on Wednesday it signed a multi-year outsourcing deal with British American Tobacco Plc, the world's second-biggest cigarette maker.

Wipro will help British American Tobacco's application support services for global business operations, the company said in a statement. Financial details were not disclosed.

Oracle closes $7.4 bn Sun deal

Software major Oracle Corp has completed the takeover of hardware company Sun Microsystems Inc for $7.4 billion.

The deal, which was announced nine months ago, would transform the IT industry, Oracle said in a statement yesterday.

The two companies, which have a significant presence in India, together employs more than 26,000 people in the country. Oracle has more than 25,000 employees in India while Sun Microsystem has 1,200 people.

The Sun Solaris operating system is the leading platform for the Oracle database, Oracle's largest business. With the acquisition of Sun, Oracle can optimise Oracle database for some of the unique, high-end features of Solaris.

"With the addition of servers, storage, SPARC processors, the Solaris operating system, Java, and the MySQL database to Oracle's portfolio of database, middleware, and business applications, we plan to engineer and deliver open and integrated systems--from applications to disk--where all the pieces fit and work together out of the box," Oracle said.

The European Union's antitrust watchdog has approved the Sun-Oracle transaction last week saying the deal would not would restrict competition in the database's market. The approval from the EU came after months of investigation.

In April last year, Oracle has agreed to buy Sun Microsystems for $7.4 billion or $9.50 a share in cash.

Monday, January 25, 2010

Wipro to give salary hike

India's third largest software exporter Wipro said it would hike salaries across the board this quarter, but did not indicate quantum.

According to Pratik Kumar, corporate vice president, human resources, the salary hike will be given out in February. He added, “The hike will be according to the industry standards.”

Wipro beat estimates with a 19 percent rise in December quarter profit and projected growth as a global economic recovery boosts demand for outsourcing services and eases pressure on fees.

New York-listed Wipro expects its IT services revenue to rise 3.6-5.4 percent in January-March from the preceding quarter to $1.16-$1.18 billion, after it posted a 4.9 percent sequential rise in the latest quarter.

The company also announced that it will hire people from campuses. Some 7,500 people hired previously are expected to join in Q4 and early next quarter.

Last week Tata Consultancy Services also announced that it expects to increase wages in the 2011 financial year.

TCS global head of HR Ajoy Mukherjee said the company has decided to give salary increments during financial year ending March 2011, although the exact quantum of hike is yet to be decided.

“There definitely will be a wage hike but the quantum is not finalised. We are considering three options,” Mukherjee said. While giving the hikes, the company will maintain the salary structure it moved to in FY10, which consists of a quarterly variable component and an annual variable component.

However, the company so far has no plans to increase the salaries of junior recruits.

IT cos: Pinkslips in '09, attrition in '10

India's top three outsourcing companies are ramping up hiring and increasing pay as global corporations, mainly from the US, send more work offshore to cut costs as they emerge from the downturn.

Tata Consultancy Services, Infosys, and Wipro expanded their global workforces by an average of 5.1 per cent last quarter, together adding 16,701 employees, company documents show -- an early sign that the Great Recession may ultimately benefit India as cost-conscious companies outsource more work, just as they did after the dot-com bust.

Also, after about a year of hiring slowdowns, all three companies are sweetening compensation as the fight to hold on to talented employees in India heats up.

Infosys offered its Indian employees an average 8 per cent pay hike in October, their first raise since April 2008, and executives said last week they are considering another raise to combat rising attrition.

“The market is heating up and we want to retain talent,'' human resources director of Infosys Mohandas Pai told reporters.

Infosys last week raised its gross hiring target for the second time this fiscal year, to 24,000 people. Wipro executives said they plan to offer staffers a raise in February.

Tata Consultancy Services has paid out 150 per cent of performance-linked pay -- which normally amounts to 20 to 45 per cent of compensation -- for the last two quarters, and executives say they will raise salaries next quarter, after a year-long wage freeze.

As demand for workers revives, employers have begun to worry about rising staff turnover. Employees who sat tight during the downturn have started to shop around for better jobs and better salaries.

Attrition at Wipro jumped to 13.4 percent last quarter, up from an average of 8.9 percent over the prior three quarters. Attrition at Infosys rose to 11.6 percent last quarter from 10.9 percent the prior quarter. Attrition at TCS has been stable, at around 11.5 percent, though executives say they expect that number to rise.

Indian firms say they are increasing global hiring, including in the US, as they pursue higher-end work like consulting. But US employees remain a fraction of total staff.

TCS, for example, recently finished hiring 250 Americans for its Cincinnati campus, but US employees still account for less than 0.5 per cent of the company's global workforce.

The employment revival in India's outsourcing sector, which counts on the US for about 60 per cent of global sales, comes as unemployment in the US stagnates around 10 per cent -- near a 26-year high.
Inflation-adjusted wages in the US last year fell 1.6 per cent, the biggest decline since 1990.

“When there is a downturn the compulsion to control costs increases,'' said Dipen Shah, an analyst at Mumbai's Kotak Securities. “The demand for offshoring will increase. That will play to the advantage of Indian IT companies.''

He argues that the cost savings from offshoring has helped US companies survive -- and that's good for the American worker.

“You might say jobs in the US are getting displaced by jobs in India, but because of the value provided by Indian companies and lower costs, there are firms who are able to keep their heads above water and continue to employ their existing employees,'' he said.

TCS, Infosys and Wipro, which can do everything from call center management and claims processing to software development and consulting, all reported stronger than expected results for the December quarter.

Revenues and volumes grew, signaling that the cost-cutting imperative of this last, lean year may be over for India's $60 billion software services industry.

Xerox to cut 2,500 jobs

Xerox Corp said that it plans to cut some 2,500 jobs, or five percent of its workforce, in a cost-cutting move aimed at saving some $200 million a year.

Xerox, which had 53,600 employees at the end of December, has already slashed 3,500 jobs starting in late 2008.

The latest job cuts were announced by Xerox chief executive Ursula Burns during a presentation of the photocopier company's fourth-quarter results.

Burns said some of the job losses would come in Europe but did not give a figure. She said the restructuring would cost $280 million this year with $30 million related to Xerox's $6.4-billion acquisition of Affiliated Computer Services, the world's largest diversified business outsourcing firm.

Burns said she expected the ACS acquisition to close next month. "Once completed, Xerox will be the world leader in business process and document management," she said.

The Norwalk, Connecticut-based Xerox said net profit rose to $180 million in the fourth quarter from $1 million in the corresponding quarter a year ago.

Revenue declined by three percent to $4.22 billion, better than the $3.92 billion expected by Wall Street analysts.

"We delivered a strong close to a difficult year, with solid operational results that reflect our disciplined approach to generating cash and reducing costs," Burns said in a statement.

"During the fourth quarter, we saw signs of improvement in several areas including developing markets, and we remain quite confident in our strong global competitive position," she said

"However, we believe revenue will continue to be under pressure until there is a more sustainable economic recovery," Burns said.

"To help offset this challenge, we remain focused on cost and expense management and sizing our business to better match current revenue levels."

Satyam to offer pay hikes, bonus

Mahindra Satyam is expected to offer pay hikes and bonus from January. The Hyderabad-based IT services provider, which is in the process of reinstating its accounts, had concluded its annual appraisals in December.

Staff in the S and T bands got pay hikes whereas employees of other higher levels like BI and I were offered associate stock option plans and promotions, according to an official who did not wish to be identified.

The increments ranged between 5% and 20% based on performance for the S band of employees where as T band employees were given 6-7% across-the-board hike.
The S band employees belong to the junior level while the T band people has over two years’ experience.

This apart, the company is said to have offered bonus of 20% of salary to staff across all levels of around 20%. The bonus will be paid at the end of this month.

“We strongly feel that hikes should help bridge some of the concerns and expectations and we have launched quite a few non-monetary and career development initiatives to enrich skills and competencies of our associates. The reinstatement of performance related variable pay along with the salary corrections across levels, has given the necessary confidence to our associates,” said Mukund Menon, head of business HR relations worldwide, Mahindra Satyam.

Employees whom ET spoke to across the bands said it’s getting challenging for the company since there were many exits which was affecting existing business.

However, the company, on its part, is engaged in hiring fresh graduates and also calling back employees from the virtual pool, as attrition seems to be a concern.

Wipro to cut jobs in Finland

Wipro Ltd, India's No. 3 software exporter, said that it is planning to restructure some part of its Finland operations and the move could impact a maximum of 85 people.

The company's IT unit, which employs 300 people in Finland, will start a consultation process with the staff representatives as part of the restructuring of its telecom research and development operations there.

"After carefully considering all possible options, the company has decided to enter into a negotiation process with the employees given the challenging industry situation in telecom R&D," it said in a statement.

Monday, January 4, 2010


Infy’s Orissa project to create 5,000 jobs

IT major Infosys would soon set up its second project in Orissa at an investment of Rs 300 crore, official sources said. Infosys's plan for the state was announced by its director (human resource) TV Mohandas Pai after meeting the chief minister Naveen Patnaik here last evening.

While as many as 3,000 IT professionals were now busy working at the first Infosys project in the state, he said about 5,000 workers would get placement in its second project.

The second project would come up at IT valley on the side of the National Highway No-5 between the state capital and Khurda town.

Work on the second project would start soon, Pai said. The state government had agreed to provide required water and power to the second project.

The IT major was presently exporting software products worth Rs 850 crore per annum from its existing project in the state, he said.

Pai and Patnaik also discussed on mid-day-meal (MDM) project of Akshya Patra, presently being given to 61,000 students in Puri and Nayagarh district. The number of beneficiaries of the MDM programme was targetted to touch 2.5 lakh in next two years, they said.

IBM wins 10-year IT deal with Gujarat bank

IT major IBM India has signed a 10-year information technology (IT) services agreement with Sardar Bhiladwala Pardi People's Cooperative Bank in Gujarat, the company said Monday.

'The operational expenditure in the pay-as-you-use model will enable the leading cooperative bank to save up to 50 percent in its capex (capital expenditure) on IT infrastructure,' IBM said in a statement.

As part of the deal, IBM India will provide the 80-year-old bank managed continuity services comprising server management, network and security management and back-up and database management.

HCL Info bags Rs 110 crore order from Gujarat government

HCL Infosystems today said it has bagged an order worth Rs 110 crore from the Gujarat government to supply and implement biometric attendance and computer aided learning systems in over 7,000 schools across the state.

Under the scope of the contract, HCL will supply personal computers (PCs) with biometric finger print scanner and UPS to over 7,000 schools in the state, HCL Infosystem said in a statement.

HCL Infosystems, which makes, telecommunication and security equipment would also implement the biometric-based attendance system, offer facility management and run teacher training programmes, it added.

Out of the total schools to be covered, over 1,000 schools are under the Tribal Department and 6,000 under the Education Department.
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Information technology: The wonder decade

What started as an industry riding the demand from global customers seeking to make their IT and business systems Y2K compliant is today almost a $60-billion industry, contributing nearly 4% to India’s GDP.

Source: EconomicTimes
-1999 - The biggest inflection point was the role Indian companies played in combating the so-called millennium bug. TCS, Wipro and others become trusted partners for companies worldwide seeking to achieve Y2K compliance

-Infosys achieves $100 million in revenues, lists on Nasdaq. India’s outsourcing industry grows to $4 billion 2000-2001 - Indian IT industry moves from Y2K to complex e-business projects

-Dewang Mehta, who helped Indian IT industry grow in its early years, dies. Kiran Karnik takes over as Nasscom head

-US increases H1B visa limit to 1,95,000, the highest ever

-Wipro lists on NYSE

-2002-2003 - NR Narayana Murthy steps down from Infosys and Nandan Nilekani takes over

-Post the dotcom bust, companies such as DSQ Software, Pentafour and Silverline perish

-2004-2005 - TCS lists on BSE

-Large customers start offshoring ERP-based projects. Infosys becomes a $1-billion company, Wipro too crosses $1 billion in revenues

-GE sells 60% in GECIS — the back office pioneer — to private equity firms. The Indian BPO industry starts growing rapidly

-IBM, Accenture and HP start developing their Indian offshore presence to make them their largest operations outside the US

-2006-2007 - Indian IT becomes a $31-billion industry

-Protectionism in top export markets forces Indian IT companies to start hiring locals

-2008-2009 - Infosys’ revenues cross $4 billion. Nilekani joins the government as chairman of the Unique Identity Authority of India

-HCL acquires UK’s Axon for £441.1 million, the biggest ever acquisition for Indian IT

-Satyam founder Ramalinga Raju admits to over $1-billion fraud. Tech Mahindra acquires Satyam

-TCS’ annual revenues cross $6 billion. N Chandrasekaran takes over from S Ramadorai as chief executive
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TCS, Infosys, Wipro give local flavour to foreign operations

India's large software service providers are going increasingly local with hiring in overseas markets, part of a drive to position themselves as truly global players and polish their image in advanced economies reeling from job losses.

Beginning with employing foreign nationals for junior and mid-level positions, companies such as Tata Consultancy (TCS), Infosys and Wipro – together these three account for about a third of India’s IT exports – now have a number of foreigners in their top echelons.

“There’s a transition in mindset to grow out of the Indian mold and aspire to be like an Oracle , IBM, Accenture, SAP. Also, as Indian companies have gained scale they can tap the best foreign talent; earlier they had to settle for just about anyone,’’ says K Sudarshan, managing partner at executive search firm EMA Partners International.

In the past year, many of the top positions at Wipro Technologies have been filled by foreigners. American Martha Bejar left Microsoft to join India’s third largest software exporter as president, global sales and operations. Ralf Reich, a former Unisys executive in charge of strategic outsourcing in continental Europe, was appointed head of German operations. And Wipro’s centres in France and Japan are also headed by non-Indians.

Infosys’ German, French and Australian operations are managed by locals. Jackie Korhonen, ex-vice-president of managed business process services for IBM Australia and New Zealand, is now head of Infosys Australia.

“They want to be true multinationals. Besides, if you want to really penetrate a local market, bagging business from not only big companies but also small and medium, you better have a local face,’’ says Diptarup Chakraborti, principal research analyst, Gartner.

At TCS, India’s largest technology services company, foreign nationals comprise nearly 12% of the senior management. Among the key executives are John Lenzen, global head of marketing, Gabriel Rozman, global head of emerging markets and Carol Wilson, global business unit head, Hi-Tech solutions unit.

Amit Singh, head of the IT practice at Avendus Capital, says that Indian companies, used to expanding at 30%, are now seeing growth decline. “They want new avenues to maintain growth and hence the geographic expansion and local faces to drive it.’’

Indian software providers have also been expanding into new geographies in the past year. Infosys opened an office in Brazil in mid-December and in recent months Wipro started operations and ramped up investments in strategic development centres and near-shore centres like Atlanta (US), Bucharest (Romania), Wroclaw (Poland), Curitiba (Brazil), Chengdu (China) and Cebu (Philippines).
Continue reading on: EconomicTimes

5 kinds of colleagues, who may be laid off soon

There are people in workplaces who cause problems that may result in them being laid off from work. According to HR expert Henry Fernandes, every office has problem employees. "Whether you are an employer or a co-worker, you have to deal with things diplomatically and on time if you do not want work to suffer," he says.

People who have attitude problem may become victims of layoffs. Such employees can make workplaces a very sad place. If other employees are demoralized, productivity will suffer. "It could be an employee's attitude towards work, excessive criticism of fellow colleagues or talking rudely," says Fernandes.

Those not coming to work on time may also face the wrath. This means work gets started late and deadlines are not met. "It sets a bad example and reflects on your working style and discipline in the office," says Fernandes.

Another reason can be if the employee doesn't keep his desks tidy. "Basically, the employee who does this is being careless," says Fernandes.

There are habits that disrupt work and affect productivity in workplace. A colleague who talks too much or discusses personal problems on the phone so loudly can result in you losing concentration on work.

Some people ask too many personal questions or keep looking at your computer screen to see what you are doing. "Even if you are sending a personal mail, they don't stop," says Fernandes.

The only way to deal with these kinds of employees is to have a serious talk with them. If you are the employer, you can be straightforward and question their behavior. If their behavior continues to affect others' productivity, it's time to show them the way out.
Source: SiliconIndia