Productivity

Apple with 21,000 employees can generate an annual revenue of over 25Billion USD
Microsoft with 79,000 employees generate a revenue of 51 Billion USD

While Infosys with over 90,000 employees generate a revenue of just 3 billion USD.
Similarly Wipro and TCS have more than the workforce of Microsoft, yet they generate only 5-6% of the revenues which this software giant generates.

Now for these companies to reach the size of Microsoft or any other technology giant, need to generate atleast 20 times the revenue. And going by the past trends, the only way they can achieve that is by hiring 20 times the workforce.
i.e. hiring 1.8 million employees each. Staggering numbers, isn’t. Even at current levels these companies find it hard to hire. I wonder if it is feasible to ever reach 1.8 million workforce.

The other approach might be to make the workers work 20 times harder… i.e. instead of a regular 8 hour shift, make them work 160 hours shift. Unfortunately a day has only 24 hours. Also almost everybody from Indian IT industry that I meet is swamped with work. They already put in long hours and I doubt if making them work any harder would benefit at all.

Ever wondered how can a country of a billion souls be short in labor?
Why is it that all the industries are finding shortage of manpower?

So the answer lies in productivity. The companies need to work smarter, cut the flab, inefficiencies and need to start respect employee’s time and efforts. Only after they start doing that, can they get the most out of an employees.

If you look at farmer suicide, the reason is not availability of loans or bad monsoon. The fundamental reason is low productivity. The average per capita income of a farmhand is couple of dollars per day of manual labor. On top of that if you add the fact that urban labors are paid either daily/weekly/monthly, while a farmer earns his bulk of income during harvest which happens 2-3 times a year, poverty is inevitable. The only way around would be to increase productivity. Either by encouraging surplus labor to move to cities or by opening up more and more rural industries. However productivity is never a key word whenever I hear about India’s grand plans to beat the West in development.

I took TCS, INFOSYS and Wipro as an example. Primarily because these are believed to be the most modern of Indian companies. Also it is easier for IT companies to enforce the best business practices than the legacy Brick and Mortor industry.

 

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21 thoughts on “Productivity

  1. @ravi…
    can you name some more?

    @srivivasa…
    i am sure the job profile of most of the engineers in mocrosoft and infy r the same…. and if you do not know, wipro and HCL have a huge hardware division employing a few thousand VLSI and DSP engineers.

    Like

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