Layoffs and Left Shifts in the Indian IT Industry

Once upon a time, the Indian IT world was the promised land where milk and honey flowed, the sun was bright and there was a nip in the air, just like the weather of its most famous host city. Companies were hiring by the thousands and money, opportunities and H1Bs abound and everyone was happy. Then the skies started darkening, and now, the thunder and lightning have begun, heralding the beginning of a storm which will ravage the IT landscape and will leave it unrecognizable. It started with Infosys announcing that they will hire people in America and develop centers there. This seemingly opened the floodgates, and now there seems to be news of mass layoffs every day. Wipro, TCS, Infosys, Tech Mahindra and everyone else are laying off people from “in the hundreds” to “in the thousands” that it has become difficult to track numbers, the most controversial being Cognizant (CTS) asking 6000 top and middle-level managers to go. It is estimated that a total of 600,000 jobs will be made redundant in Indian IT in the next few years, completely resetting the business as we have known it for the past three decades.

However, all this does not mean that the economy or the IT industry is doing badly. The state of the Indian IT industry is still very robust, which is exactly why these layoffs are happening. Companies are shedding jobs that have been made redundant by automation and other new business practices, to become more efficient and profitable. And these moves have the approval of the economy if stock market rallies are any indicator to go by. The people mainly affected by this are precisely those who had been it main flag bearers and conspicuous consumers who had been building up the industry for the past 20 years, the now middle manager. This new trend has unleashed a terrible crisis among the people in the industry, though “soft layoffs” where people weren’t outrightly fired but gently prodded to leave through bad appraisals, politics, frustration or just harassment, has been going on for at least the past 5 years. Now, panicking at the sight of the chickens coming home to roost, they are singing a different tune.

The Capitalistic Opportunistic Neo-Liberal Indian

For the past two decades, Indian IT employees, the brash children of the 1991 Indian market economy reforms, swore by, embraced and worshiped their newly found, new-generation private sector and free-market awesomeness with stars in their eyes. They modeled their lives on the American dream, swearing by the gleaming trappings of capitalism, adopting everything “America” into their lives from employment culture to commuting in their own cars to work in IT parks of gleaming glass towers and multi-level parking lots. Despising everything about the old, musty ways of socialist India, the new generation IT Indian also resisted any attempt of government intervention into the sector with more ferocity than a lioness guarding her cubs, insisting that any effort would lead to loss of its “international competitiveness” and ruin. “This is the private sector, bro,” they used to say. “where things run on merit and quality of work, not like those old, inefficient government departments where people get in through reservations, mooch around and play politics all day and get promotions and perks by sucking up“, they said. They used to go to town with weighted catchphrases like “the market decides“, “if you don’t perform you perish“, “hiring and firing is decided by the performance” and so on to advertise how their new would leave the old behind.

However, the real unthinkable was the dreaded ‘U’ word. Hordes of neo-liberalised yuppies would shudder in unison at the thought of unions, at the idea of Communist and Socialist anti-industry thugs infiltrating and destroying their new age dream. There was no need to unions, they would say, because their rights were always safeguarded by the market. Unions were for losers who only wanted to eat without working. “What do you expect,” they used to say to those protesting layoffs, “that IT companies keep you on the rolls while suffering losses? They will just shut shop and move elsewhere!” And it is those very same people who are now riling up about job losses and want to start unions in IT companies! But today, as they find themselves at its receiving end, these erstwhile children of capitalism have executed a fine 180 degrees U-turn (towards the left) and are demanding government action, petitioning everyone from the labor commissioner to the prime minister to come to their aid to “reinstate fired employees” and “restore business continuity”, and oh the horror, want even to form employee unions in IT!

In software engineering, “Left Shift” is a term used to describe the shifting of the software testing process towards the “left” of the development lifecycle spectrum, or, for the practice of continuously testing software along with the development processes. The Indian software industry is today seeing a different kind of left shift. What is happening?

So what happened now, dear Comrades?

What has happened is that until now, firings and layoffs were mainly limited to the lower strata of the at Indian IT hierarchy, the poor worker-bee coder guy who actually does all the work. The upper-crust of the managerial class was seldom touched during these exercises, leading them to consider themselves arbitrators of the industry’s destiny by virtue of their “seniority” and “experience”. Smugly settling into their chairs, they would express profound sadness about the firings while pontificating the laid off guy about fate and free-market dynamics. However, the tide has turned. In all those recent layoffs, including the massive six-thousander at CTS, it was mostly people in the middle and upper middle management that were targeted, people who thought of themselves as holy <censored> who couldn’t be touched. Apparently, they could. All kinds of 10-15 years of experienced vice-president this, director that, fancy pants manager etc. title holders cluttering up the top have all been shown the door. They will find it very hard to find employment anywhere else because they do not have any skills that would make them employable other than “years of experience”, which is hardly a productive skill anymore.

Indian IT companies business model, which called for massive manpower concentration to be re-deployed to write repetitive code to develop vast ERP suites for clients, which can hence be called the “construction site” model, was long past its expiry date in this era of digital and mobile, automated business processes, cloud computing, and big data analytics. Since Indian IT companies, in essence, are little more than glorified labor contractors supplying cheap talent for overseas clients (body shops), most “work” of all those umpteen managers was in one way or other to manage the deployment and work of all those people. As digital, cloud and automation started cutting down the number of people needed to write code and to maintain infrastructure, it also eliminated whatever need there was for Excel sheet managers, resulting in the current bloodbath. It is as simple as that.

Can’t help with the Matrix references

What they don’t seem to realize is that all this crisis they are facing now did not come out of the blue, and no, Trump and his H1B policy or any recession are not solely to blame for this, though it was the trigger. Anyone who was following trends of the IT industry would’ve noticed that with the rise of automation, changing business practices, new technologies and changing global political climates, this writing was on the whiteboard for many years now. But the average middle manager, mired in his own delusions of apparent indispensability, failed to notice this. And this also shows that Indians are not really capitalistic or socialistic or any other stick other than just opportunistic. And it is too late to start forming employee unions in IT companies.

If they had allowed the formation of unions or at least worked with the labor department to implement some kind of labor laws in the IT sector from the beginning, they wouldn’t have had to fight for their “rights” now. Back then, India did have a strategic advantage of proficiency and cost-effectiveness, and MNCs would’ve agreed to labor laws. Today, they will just laugh and pack up. IT companies have no more business to extract from India. It is all done. You do realize that all those MNC campuses are all leased, right? Indian ones like Infosys consider their own campuses as real estate investments. And what exactly are they going to protest? That these private companies employ them on altruistic reasons because they have to pay EMIs?

The Indian Employment Culture as a Reason for Job Losses

See, the average Indian IT company’s apparent philosophy of working based on western notions of merit and equality are all at best, window dressing. In reality, their organizational behavior and employment culture are as hierarchal, patriarchal and sometimes autocratic, as in any other Indian institution. Since we had only government jobs for a long time, we view all employment through this prism of the “government work culture” and try to apply that everywhere.

Seniority is directly proportional to salary, commanding power, respect demanded, job security and inversely proportional to work needed to be done by the self.

We were taught that our life was a race to be completed, a destination to be reached, a tape to be breached, the attainment of some “big officer” position, after which we could pursue the undeniable real purpose of our life: “settle down” and propagate the clan. Education and employment are all means to that end only. Hence, concepts like further or continuous learning to build up a meritocratic, knowledge-based career(s) simply does not exist in our culture. Neither does dignity of work. As getting hands dirty doing “work” is considered inferior, people in managerial positions do not work, they only manage. A manager considers himself hierarchically equivalent to the elder in an Indian family, whose job is mainly commanding and controlling juniors. When the private sector came in with its “Americanized” working culture we equated (confused?) those manager jobs with “officer” posts.

So, once a programmer, reaches the level of middle manager, he is “settled” and his life, set. His life objective has been achieved and he could now coast until retirement (still some 20 years away) looking at Excel sheets, approving leaves and appraisals, forwarding FYI FYA PFA emails, attending endless meetings, conference calls and presentations, receiving favors from juniors and lecturing them on the “woverview” of the industry, playing office politics, traveling to conferences and meetings at client locations, and so on. As years pass by, they lose their creative and technical skills, remain oblivious of new technologies and developments, becoming “part of the ship, part of the crew” parasitic dead weight, and not because of their expanding waistlines. Basking in the glory of their ridiculous business card titles, they feel entitled to a job because they “have experience” and because they are “elder”, demanding respect and threaten to wield their “influence” in the company and industry, and so on and so forth. Forget powering Indian IT to the next level with radically new technologies and paradigms, they couldn’t even remember what coding felt like, miring themselves in the complacency thinking the good times would last forever.

It turns out IT babus weren’t so different from the government babus after all, guilty of practicing everything they were accusing the latter of, but only in gleamier surroundings. They were just as lazy, corrupt and useless. They were all hardcore capitalists only because it suited them, it brought them flats, cars, foreign travel and large bonuses and hikes. Now that they cozy cocoon has been broken, they hypocritically want to embrace the other side.

The World is Changing, Don’t Become Irrelevant

If 6000 people could be laid off, imagine the deadwood these companies had been carrying up on top all this time, people who did little other than driving up real estate prices and living costs in all Indian cities while denying chances for the younger generation who are now crashing the gates of IT companies looking for work. They had lots of chances of reinventing themselves but were happily farting into the wind all these years, because that is easier. Those who did reinvent themselves are still doing very well and will continue to do so. This kind of creative destruction is necessary for any system to grow and flourish, and for the new to arise out of the old. Going forward, there will be no more middle managers who sit around thinking themselves to be Gods and push and bully people around. They will be replaced by highly specialised knowledge and subject experts, mostly consultants, who will drive and monitor highly efficient process paradigms governed by automated tools. DevOps and Continuous Delivery are beginnings of this.

Indians haven’t understood properly how capitalism of the business world works. When President Trump (ji) among others said that he had enough of Indian software engineers, Infosys promptly responded by clicking its heels together and moving their business to the land of the free and the home of the brave. They just went where their clients are and the money is (there is no such thing as a domestic Indian IT market), crushing a lot of people who thought Indian IT companies would never act in detriment to the Indian people. Unfortunately, Indian IT, like any other business, exists with the sole motive of making as much money and profits no matter what the individual suffering is, and not altruism or nationalism or anything else, and will do whatever and will move where ever required to achieve that end. No one is indispensable in this (or any other) business. One does feel sorry for all the people who get laid off, but it is now too late to complain and cry. They should’ve known that they aren’t immune from the rules of the system they themselves created, that when they reaped its benefits when it was benevolent, they will have to face its wrath one day as well. Entitlement will not get you anything, not even if you suddenly turn Communist because your Capitalist God suddenly bit you in the ass.

Long live the proletariat. There are no free lunches.

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  • Maria

    Your section on Indian employment culture was really eye-opening to me why some Indians reporting to me on my team behave the way they do. I am not really sure how to get them to understand the Western ideas of a merit based system. FWIW, I am a white female, probably 20 years their junior, and I inherited them from a male Indian manager who was let go. They are not happy.

    • disqus_dor1YsFNCG

      It would be difficult to make them understand the idea of merit based system, unless they themselves choose to learn it the hard way.

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