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Is IT Sector Killing Itself and The Young Minds By Keeping Them “On Bench”

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Figure out a few of the headlines in recent times,

“18,000 People On The Bench At Infosys”
“Mahindra Satyam places 500 associates on bench”

Not that this practice is something new, but it has never ceased to riddle me. Moreover, in the current economic downturn, with companies battling it out to maintain their profitability, these headlines sure signal a cause of worry.

I had wanted to write on it for quite sometime, but it was not until that I read this piece by Sramana Mitra who is asking what these 18,000 people are doing (Infosys Headline).

Not sure if I can answer this, since I was lucky enough to be un-benched quite early after joining the job. But, I have had my experiences and the ones I gathered from people around me. And believe me, they are anything but nice.

on-bench-employee

To begin with, lets visualize it from the employees perspective,

A fresher in most cases is too full of excitement and zeal to excel at his/her first job from day one. To ensure that, the individual goes through the rigorous training sessions with utmost dedication. The onus is to successfully make the transition from student to Corporate.

But, what happens if the employee is not assigned to any meaty (real) work even after months of working?

  • The individual keeps at it and goes on expanding his/her skill set in order to be ready when the next project comes by.
  • Some Individuals actually start liking the idea of “Getting Paid To Sit and Do nothing”
  • Frustration starts creeping in some, and they start detesting the place.
  • The employees start considering a switch to a different workplace in the hope that they get to do some real work.

Except the first point here, all others signal a major waste of Talent.

Even with the first one, there is a major issue. The individual with all the learning that he/she has attained will not help build the confidence/ motivation until they are assigned some real work.

After all, what good is all learning/training if not put to use?

I don’t even want to start talking about the kind of trouble it spells for the Employer.

  • The bench strength becomes a Non performing Asset in tough times when the organization is struggling to maintain the profitability.
  • The employer misses out on real talented people who are being wasted on bench solely because of the reason that they don’t have a real time project experience.
  • The above is a Chicken and Egg problem. With all clients asking for experienced resources, the bench until put to real work will never be acceptable.
  • All the money that the employer spends in training and grooming the individual goes for a toss if the employee is smart enough to make the switch to another company.

There could be awful lot of reasons that the employers may have to defend their stand on the ever burgeoning bench strength. But, I am sure that the negative ones will outnumber them any day.

Talking about a problem is not going to solve it. I am no trouble shooter/ problem solver to dish out a solution for this god forsaken issue. But then, who is going to stop me from offering my 2 cents :)

  • Why not have a team specifically geared towards Product Development and be serious about it. Utilize the bench to work towards creating a product worth selling. That way, it is a win-win. The employee gets the near real time work experience and the organization gets tangible Intellectual Property.
  • Why not create corporate accounts on various Freelance sites. Bid For the projects and have the bench strength work on completing those assignments. The bench becomes workable and the revenue flows in.

Not sure but there are some companies utilizing the first point here. But the fact that how many are effectively utilizing the bench strength for that is something I cannot vouch for.

The second one may not be a feasible one given the technical / political / ethical issues linked to them. But, I don’t see why the so called MNC’s should not consider it as an option.

What are your thoughts on the same? Do you think there is a solution to this problem or this ain’t that big a problem itself?

[This post has been written by Ankit Agarwal, an ERP Consultant by profession, a wannabe entrepreneur and stock market stalker by passion]

"Is IT Sector Killing Itself and The Young Minds By Keeping Them “On Bench”", 5 out of 5 based on 1 ratings.
  1. Sumit says

    well this prbm is a necessary evil. In IT companies many clients ask for a buffer, which is bench. When a company is doing its manpower requirement analysis it will calculate a minimum 15 % buffer, its logical we all pad our requirements.
    The pbm can be wen a resource is idle for more than 6 mnths, but this is mostly the case with 0-4 yrs exp ppl seniors are more occupied.
    This 0-4 yrs lot anyway wants to grow to better positions ans we all knw ajob shhift is often a better career decicion in this economy than sticking to an idle job, even the company u wrk in hires ppl qhi have been on bench eslewhere and moat of the times they get a better job.
    So go with the flow.

  2. Ankit says

    Cool rabi.Dropping you a mail right away.thnks for sharing

  3. rabi gupta says

    yeah Ankit it was fun reading this article and posting my views. I’ll send you the paper. Just send me your email id. mine is rgupta29[at]gmail[dot]com.

  4. Ankit says

    Thanks a lot guys!! The response have been overwhemling for this one.Moreover, it is evident that ‘bench’ is indeed a problem.

    @rabi You almost wrote a post there.Thanks a lot for ur detailed views.I would luv to get my hands on ur paper if IP does not restrict u for not sharing it.As for ur concerns mentioned, i belive i should another post as a sequel to this:D
    Will try answering them in detail

    @sherwan I am sure there are solutions, but may be they aren startight forward. Only when both the employee and the employer realise the graveness, can we expect some positives on the ‘bench’ problem
    @natraj it sure is, a blog is made successful by the readers.This one is serving its true purpose

  5. sherwan ahsan says

    the problem is indeed grave…thousands and thousands of engineers sitting on bench in corporates like wipro, infosys and tcs point out to the humongous loss of young talent, which only breeds frustration and inefficiencies.internal projects and trainings have been ineffective to curb this waste.Wonder if there is any solution in sight

  6. Natrajan says

    It’s Nice to see experienced people coming out with their viewpoints. I hope to having more such discussions in the future.

  7. Ankit says

    @natrajan Arun has pointed out the odds in ur example.

    Moreover, ur friend was working on obsolete technology.The bench is always trained on cutting edge technology in order to prepare the company to be ready when it launches.
    I am not sure of any cumpany training people on obsolete tech

  8. Ankit says

    @Nataraj
    Glad to have u here.I have been following Strat for sometime:D

    No offence, but i dont agree with ur thoughts one bit.
    I am probably too inexperienced to talk how the IT industry works but IMHO the companies maintain Bench in order to keep themselves ready for new projects.The bench is maintained and trained so that they can bid for new projects and have a trained workforce waiting in the sidelines.
    As far employees threating to quit, frankly i dont see why the companies should bother.There is no dearth of resources in the market today.
    If one guys, there are always two to hire.
    I am not blaming the IT industry per se for their overhiring, i am saying is that they need to devise a better way to optimize their assets

    1. Natrajan says

      @ Ankit

      I’ll give you an example. A friend of mine was working in an IT firm on an obsolete technology that very few people are trained on. He got an opportunity in another firm with 100% raise(since there is very little supply of resources in this technology) and the previous firm could not afford the new salary. So they lost him and they still can’t find a replacement. If there was enough bench strength for this technology, there would be not be any need to worry about employees threatening to quit.

      1. Arun Prabhudesai says

        Hi Natarajan,

        There is always a demand in certain niche areas..The problem is this forms only 1-2% of all. Now in this case your friend was lucky, but it may happen (and in most cases it does) that he may not get a job for months even years because his skillsets lie on age old technology. There might be a cobol-fortran project somewhere but there will be very very few resources willing to work on such.

        This example of yours cannot actually justify the overall scenario…

        Having said that, its nice to come across healthy discussion like this..thanks for providing your point of view in detail..

    2. rabi gupta says

      I couldn’t stop myself from commenting. I’m in a similar software company (one of d top 3 in India :-P) for past 2 and half years. I have also observed the same trend and also wrote a paper for my Company titled “Free Pool (Bench) Competency Group” and presented the same at various levels around an year back.
      Though I firmly agree with your points related to the trauma employees face while at bench (though luckily I never served it for more than 2 months), I don’t agree with you completely when you raise questions over corporates. This is because I have seen their reluctance towards this.
      My paper actually conceptualized how we can effectively utilize bench employees from various locations with multiple competencies. The solutions included were very similar to your ideas- Try to shift their focus towards innovative product development and all. Many people saw my paper and were excited but then they started counting the negative sides of it & they were bang-on.They presented Points Like- 1. when you have 20,000 odd bench employees working to develop a product they will actually consume resources like hardwares and softwares. Who will pay for them? Because in general case every billed employee is paid 4-5 times from the client (which takes care of their resource consumption). 2. Most of the people in bench are freshers and have no prior experience to develop a product on their own. 3. product dev is not a child’s play. Companies have to spend millions of dollars just to know what kind of product can be sold/will sell in the market. 4. Corporates (including the one I work for), already have product development units, which are small yet profitable and they won’t like to disturb those. 5. And yes, if you are actually utilizing a resource at a forum like “Free Pool competency group” what if that resource forbids to join a client based project. In that case whole point of keeping a bench strength is lost!
      I hope this direct experience helps you find some answers?

  9. Natrajan says

    There is a general perception that bench is actually a cost and increases the firm’s cost still not adding any value to the firm. It’s wrong. A bench is a strategy employed by an IT company to reduce dependency on skilled workers.

    Let me explain it. Say a company has exactly the number of resources(read people) they need for a project. What can stop these resources from threatening to quit the company for a pay hike. If the company has bench strength these people could never threaten to quiz because it’ll not be a credible threat. That’s why an IT company overhires and puts people on bench to bring down overall salaries.

    Check out our article on a very similar topic.

    http://strat.in/2009/07/government-blaming-the-it-sector-now/

  10. Ankit says

    @kIRTEE
    I never said laying off is an option:).It is never an option et all

    I am not sure i understand your views on why the ‘product focus’ should not work.
    As far as ur Asset Leasing is considered, IT Industry is a gaurded thing.There are too many secrets to keep.The cost of creating that asset is huge.So, selling /leasing them is something that is risky.
    However, this is used at some places and more commonly known as Body Shopping

  11. VJ says

    On paper its a good idea to use a bench team for product development.Practically i think its quite difficult to have a fresh team build a product from scratch, if u r speaking in terms of google,flexicube etc.
    may be products for internal use be done utmost.

    Sometime back infy promised its employees that they wud get 50% salary for staying home.I thought that was a good opportunity for ppl to do someting on their own…did it happen?

  12. Ankit says

    @Sriram Thanks For ur meaty comments.Frankly,Even i know that there is a full proof solution to that.
    And i am in no way defending the employee side here though it seems tiltled that way:)
    The Idea here is that masses of those new joinees are unaware of the terms start-up ,entrepreneurship.So, for them the onus is to get a job in a good company and take it up from there.
    So, when a infosys hires them and after months of sitting joblessness, they lose that zeal to excel.
    Hence, my only concern is that The IT companies should look out for ways to better optimize the resources that are on bench.
    I agree with your thoughts that freelancing is something that a Infosys wont resort to.But that was only a suggestion,which even i doubted:)
    Moreover, with t product development idea it could lead to a paradigm shift.
    More so, to ensure that the employees keep at it, why not incentivize the teams that are able to create a sellable product

  13. Sumit says

    Hi

    Cant agree more with you. Infact to aad , the troubles dont end here. The people from management backgrounds suffer even more.Satyam(now Mahindra Satyam) recruited thousands of management trainees and hardly gave them any training or productive work. After the scandal they have become redundant both for the company or any other industry.

  14. KIRTI says

    hey Ankit!
    nice write..
    But do you think offlaying 18,000 odd ppl will b a feasible measure as well..who will bear the cost of public uproar, tarnished company image!
    Regarding the solution the ones u hv propsed sounds gud..
    but biz seems to follow principle of conservation..loss of one will be gain fer the other
    so y not sell these trained assets to the one who are on the move rite then!afterall assets are meant to give monetary gains..or the asset cud be put on lease..

  15. Sriram Vadlamani says

    Well nobody is asking them to stick around. It all boils down to the employee. Even Infosys mentor Narayana Murthy has asked everyone to start something on their own. What is stopping them to do that?
    Stop going to work were his exact words. I think those 18000 can start doing that. Read Here

    If we are blaming the IT companies for creating excess capacity then we are back to our old ways. Capitalism has got us this far and if we start defending the employees it will be back to socialism.

    Coming to the options provided, I like the product development team option. It is high time we got some products out there to compete with the Google’s and twitters. And may be Infosys has to lead the way.
    And bidding for freelance projects, trust me that is the worst thing that could ever happen to the democratic web. That would hurt many freelancers really bad. Now we have a company which has reputation bidding for the projects which an individual with no reputation is also bidding. If the cost is the same who would you pick?

    I don’t think Infosys will be bidding for freelance projects on elance and oDesk. Infy is a high dollar player and the freelance projects don’t even pay for its toilet paper.

    Have you seen the projects? 50 articles on variety of topics and we will pay $1.35 per article. Article has to be 500 words long. Yeah, here is my bid- “$bugger off”.

    PS: Speaking of bench strength most of the employees in government sector have been on bench for a long time. I don’t see them complaining.

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