Where exactly is the recession? Infosys shows the way.

Just a few days ago, while declaring its Q4 results, Infosys announced a freeze on salaries and reduction in variable pay (see here). This effective means reduced take home salary for the employees. All this when the profit dipped by a mere 1.7% over its Q3 profit. Note, however, that Infosys actually made an yearly profit of 29%.

"Ok!", I thought, "here's a company which is sitting on a pile of cash; it has zero debts. So, if they are reacting to cut operational costs, they must know something that I do not. The world economy must be heading for a major downturn in the days ahead."

Now comes the news that Infosys Top Brass will get over Rs. 10-Crore Hike.

Doesn't the hike freeze apply to all? Oh I understand: the employees have to tighten their belt because Q4 results are bad and Infosys expect a dip of 3-6% profit in the future, but the top brass is being rewarded for the Year-on-year jump in profit.

Wait. This can't be right. What am I saying? I don't quite understand this. What am I missing here?

F100! Not G20

Headlines scream: World Leaders agree to "fight back" against global recession at G20 summit.

An alien reading this would rightly conclude that recession is some external agency threatening mankind. And that the world has united to fight it. Funny that!

Ok here is a better idea than G20. I would call it F100. Get the top 100 companies of the (World) Fortune 500 together and ask them to come up with a plan. They will not 'fight back' the recession. They will solve the economic crisis. They are the insiders. And they created the chaos in the first place. They should be able to do a better job that politicians.

Anyone out there reading this blog?
Ready to take up the challenge?

Knee-jerk reaction to recession is not an accomplishment

India's biggest software house, Tata Consultancy Services (TCS), is believed to be avoiding travel to reduce costs. Instead video conferences, telephonic conversations and web casting will be used to discuss matters. This should minimize travel requirements.

Questions:

1. Does it require a recession to cut costs?
2. Isn't a company obliged to cut costs and pass it on the benefits to the customers or employees?
3. Who were the people who authorized travel when a telephone call was sufficient?

Ahh! The answer to the last is all too obvious. I do not know how this process works at TCS. But I know for certain that most of these travels are undertaken by the executives themselves. The top management sitting at Headquarters are not bothered as long as targets are met.

You see, when things are hunky-dory, it takes top management of exception foresight to insist on stretch targets. Cost cutting is seen as retro-step. I can bet on my fledgling blogging career (!) that internal auditors at TCS must have raised objections but the executives must have shot these down insisting that such business travels are essential.

And why am I upset about this? Because by making a big hoo-haa about the measures TCS is taking to fight slow down, it is actually admitting that there is a lot of scope for cost cutting thereby confining Indian software industry to compete on costs for ever.

To all those managers / executives I have this humble request. Please do not announce knee-jerk reactions as accomplishments. Please do these within the four walls of your company. These are not achievements. You should have done this long ago.

Yes, if someday you do a 'Nano' shout from the roof top.