Wipro Plans Mid-Level Employee Layoffs To Boost Margins
Wipro, an Indian IT major, is apparently planning to let off hundreds of mid-level onsite employees as part of a margin-boosting strategy.
Faced with growth constraints and underperforming market peers, Wipro seeks to enhance its financial performance. The decision followed notifications made to employees in early January, with an emphasis on the company's onsite resources in Capco, which are deemed expensive. Aparna Iyer, CFO, aims to exhibit greater margins in the current quarter.
Wipro now has the lowest margin of the four top IT services companies in India, at 16 per cent for the December quarter. In comparison, HCL Technologies, Infosys, and Tata Consultancy Services had margins of 19.8, 20.5, and 25 per cent, respectively.
According to reports, these layoffs are part of Wipro's 'Left-Shift' plan, in which responsibilities from a level 3 employee are allocated to a level 2 person, while level 1 jobs are automated.
The corporation, led by Thierry Delaporte, paid $1.45 billion for Capco in 2021, making it its largest acquisition to date. However, the acquisition's performance has been hampered by a drop in discretionary expenditure caused by a slowdown in Western economies.
Wipro emphasises its commitment to investing in people, processes and technology to improve client and employee experiences, hence aligning its business and talent with the evolving market environment.
