Acquisitions in the Offshore Industry

Horses for Sources has a post on the rumored merger discussions between Cognizant and Genpact. Financial Express reported on it first. I disagree with the premise of the post and wrote a long comment which for some reason did not post to the blog. So I am reproducing it here at the end of the post. (Note to self: always write long comments in a notepad before you post them.)

First let’s look at what could be the rationale for an acquisition in the Offshore industry. To my mind there are four models that justify an acquisition. They are not mutually exclusive and most acquisitions may be classified under multiple models.

1. Acquiring Offshore Capability

The legacy model of IT Services and BPO is no longer viable. Whatever remains is crumbling under the weight of offshore economics. It has taken over a decade to do so, but most of the major players – IBM, Accenture, Cap Gemini, Unisys – have all set up, with varying degrees of success, India and other low cost country capabilities. On the way, some of them took the opportunity to acquire an Indian company. IBM acquired Daksh and EDS acquired Mphasis. I see acquisitions in this model continuing as promoters in smaller Indian companies becoming more willing to deal.

2. Market Footprint expansion – Geo, Vertical

These will typically be small, tuck-in acquisitions. You could be buying a point presence in a geo or a vertical where you see potential but don’t have a foothold. Infosys’s acquisition of Expert Systems in Australia would be in this category.

3. Service/Solution expansion

TCS’s acquisition of Citi Global Services gave them a solid capability in BPO in Financial Services. HCL’s Axon acquisition would be in this category as well.

4. Scalar expansion

Acquiring a company similar in most respects to your company would fall under this category. Tech Mahindra’s acquisition of Satyam and Caritor’s acquisition of Keane would be called scalar acquisitions. I call them scalar, because the rationale behind them is to scale the company. I believe that there hasn’t been enough of this kind of consolidation and that this is coming soon to the industry. My earlier post gives the reasons why.

One model that is conceivable but I don’t hold out much hope for is where an Indian services company acquires a major consulting led company. I just think the integration is too tricky and the risk of flight of talent is very real. HCL Axon approaches this model, but Axon while reasonably large was a very focused SAP consulting and services company and SAP was never HCL’s strong suit. So they can effectively carry on doing what each of them was doing pre-merger and avoid any integration whatsoever.

This may look like the same combination as 1) above, but it is not. If a major global player acquires a mid-sized Indian company they will operate it purely for offshore capability. All market based roles and leadership roles in the company will be retained by the acquirer. But when an Indian services company acquires a consulting company, it is not clear who will lead and who will follow. And that is what will lead to trouble.

Onwards to the possibility of a Cognizant-Genpact combination. Why might this be a very good combination? Here are my reasons:

The businesses are very complementary. Genpact is less than 15% IT Services. Cognizant is 5% BPO. The lack of overlap means a few things, all of them major factors:

  • In one stroke Cognizant as the acquirer becomes one of the largest and most sophisticated BPO service providers. In addition to already being a large high-growth IT Service providers.
  • One of the worries in Services acquisitions is that you will end up offering the same services at the same clients at different rates and then the client will move all services to the lower of the two rates. That overlap is going to be minimal in this case.
  • The senior teams of both companies will find homes in the combined company. In the medium term they should not have to merge leadership of business units.

Horses for Sources (HfS) says that the BPO culture is quite different from the IT Services culture and that will not bode well for a merger. I can’t see why they would think this. Both companies have a dynamic, growth-oriented culture and have professional management.

HfS thinks that Indian companies have used cash for acquisitions and Cognizant doesn’t have enough cash to acquire Genpact. Indian companies have used cash so far for acquisitions because they have enough cash – actually more cash than they know what to do with. This cash expands the balance sheet and lowers investors’ return on capital. Companies like Infosys have done several special dividends to reduce cash. Nobody in their right minds would use stock to acquire when they have that much cash sitting around.

Does that mean that they won’t use stock when they have to? Absolutely not. I don’t think Genpact’s investors would have any problem accepting CTSH stock.

Also, on a related matter, both Genpact and Cognizant are listed in the US with no float in India. This makes things easier. Acquiring a company 100% in India is a little messier, procedurally.

The fact that GE is 40% of Genpact’s revenue is known and will be priced in to the acquisition price, post due diligence.

The rumor may or may not be true and even if it is true, the deal may or may not happen. But on the face of it, it makes sense. The combined company will be on target to be the second largest in the Offshore industry after TCS within less than a year based upon projected growth rates. And in this industry size matters.

The Long Backlash Against Offshore

The US and Western Europe account for the lion’s share of the market for Offshore services. In the medium term they are expecting slow or no growth and at least in the US, high unemployment rates.

In such a scenario, we should expect that the public opinion will turn against offshore. Naturally therefore, the anti-offshore rhetoric in the media and from politicians will ratchet up.

In the past, the polemic against “offshoring of jobs” at the national scene has generally focused on China and the loss of manufacturing jobs in the US. The reasons for this are:

– The impact of Chinese manufacturing on US jobs preceded Offshore services outsourcing by almost a decade. The magnitude of the impact was also much larger.

– Loss of manufacturing jobs is a union issue. The Dems are extremely sensitive to union issues, especially in the Rust Belt (which became rusty because of Chinese outsourcing).

– The early impact of Offshore services was on IT workers. And for a while the impact was softened because of the growth in the IT sector. The employment in the sector grew so much till the tech bubble burst, that it easily absorbed both domestic workers and outsourcing.

– IT Workers were typically better educated and higher paid. If they failed to find another job, they had a college degree and would be able to find some other form of employment. Probably lower paying but they wouldn’t be without a job for too long.

But things are different now.

Chinese manufacturing still has a much bigger impact. Which is why there is so much angst in the US about China’s pegged currency rates (which is deserved, IMO). But there are other things that are different this time around.

First, the impact of Offshore services is slowly veering away from IT workers to regular white collar workers – from customer service to business analysts. Many of them don’t have a college degree and don’t have flexible skills.

Second, while the US was losing manufacturing jobs to China, the service jobs were picking up the slack. Over a couple of decades, the composition of the US workforce shifted dramatically to where services jobs accounted for the bulk of the workforce. Now as services jobs slowly start leaking out to India, there is no mega trend to rescue it. To make things worse, unemployment is expected to stay close to 10% for a while.

As you might expect, the backlash has begun. There was the Borders Bill. Then state governments, who are incidentally running budget deficits, have started barring government outsourcing to include any offshore component.

From the NY Times article on the Border Bill

“I’m thrilled that these companies are complaining about having to hire more Americans,” said Senator Claire McCaskill, Democrat of Missouri. “That is the whipped cream and cherry on top of this sundae.”

Indian services companies run the risk of becoming punching bags for American politicians. Unless they do something about it.

The first thing you need to do if you are responsible for your company’s response to the backlash, is to be clear about your own position. Offshore services may be called outsourcing. It may be that you can point to the guy in India who took away a specific American’s job. But despite all this, Offshore services is no different from trade in merchandise of any kind. Offshore is trade in services. Keep repeating that sound bite. If people attack Offshore, they are anti-trade.

This is not about twisting facts to make a bad situation look good. It is in fact exactly right. Which is why no economist worth his salt will stand up and say that the US should place restrictions on Offshore services. Because it is trade. And unlike Keynes, there are no economists contesting Ricardo.

Next, talk about all the American goods that Indians consume. From Nike shoes to Cisco routers. I haven’t confirmed this yet, but someone I spoke to today said that India-US trade ran a deficit on the Indian side after accounting for services.

Then, talk about the fact that there is a shortage of IT workers in the US. Unemployment may be at 9%, but that doesn’t mean that unemployment among college educated software engineers is anywhere close to that. This does sidestep the issue of the impact of BPO but if you had the aggregate numbers I am sure one could craft a response there as well.

Finally, craft a coordinated PR plan through an industry body. Don’t just sit back and let the media and politicians control the message. Some of this seems to be happening as is evident from this article in the FT where both Infosys and Cognizant are quoted.

The action above should be happening in the media and in meetings with clients and, importantly, employees. Employees who are onsite meeting clients are often asked these questions by concerned client managers. If they are armed with the right messages and data, they can handle these questions much better.

Another important area of action is to influence governments. I doubt if lobbying US legislators is going to go too far, at least in this charged atmosphere. But it does help to at least have industry body representatives get their point of views in front of legislators.

On the other hand, lobbying the Indian government to take action is likely to be very effective. India and the US have a special relationship. Neither side will want a trade war and will work to avoid a situation where India does a tit-for-tat targeted tax on consumer products from companies which are majority owned by a US company.

Lastly, the best friends of Indian Offshore companies are American corporations. They like the cost, flexibility and availability of talent in India. They are global corporations and believe in open markets. They would love to do more business in the Indian market. And they have leverage with US lawmakers.

Outside the US market, the UK market is going to follow a similar pattern. Outside the US and the UK, the stakes are anyway smaller. The environment is going to get tougher and more unfriendly to Offshore over time if things don’t improve unemployment wise. It’s important to stay focused on this matter and be proactive. Damage control after a bill like the Borders Bill, achieves very little.

[Update: For completeness’ sake, I must mention that the most important action point perhaps is to actually hire more Americans. Or Britishers. There are Indian companies who seem to be doing that with some success. An earlier post on local hiring.]

The Cost of Onsite Hiring Just Went Down

The US Southwest Border Bill imposes an increased application fee of an additional $2000 for every H1B and L1 employee on a few Indian Offshore Services companies. Much has already been said about it by politicians, Indian companies and NASSCOM. [NY Times, Hindu]

In early July I had written a piece on the challenges of Local Hiring or onsite hiring. In it I wrote

Also, there is the issue of optics. Can you do X billion dollars of business in a country, with tens of thousands of employees in the country and hire just a handful from the local market? The law may allow it, but you have to do much more in the court of public opinion.

Little did I know that Senator Schumer was actually planning to change the law itself.

But perhaps this will be the turning point for onsite hiring. There are other good reasons to increase onsite hiring. Again, from my post

Going forward, local hiring will become more important. Winning business is now less about technical expertise, which is assumed. It is about domain expertise – do you understand my business process well enough? It is going to be pretty tough to build domain expertise organically – through the work the company does for clients. Hiring industry expertise into the company either from industry or from other consulting companies will become necessary to compete.

Indian Balance of Payments and Offshore Services

The RBI is concerned about India’s Balance of Payments. One of the reasons ascribed to the growing problem is the slow down in the Indian Offshore Services industry. From today’s FT

One reason, the central bank said, for the deterioration in the balance of payments was a decline in an “invisibles surplus”, caused in part by falling revenues to India’s prized outsourcing sector.

For my book I crunched some data from the RBI website. As you can see, on the Current Account, India depends a whole lot on the Offshore industry.

Without the Offshore industry being where it is today, the import regime could not have been as easy as it is today.

But I am a little confused on the timing of this. Given that last quarter was very good for most of the top companies, isn’t this now no longer a concern? Or is it that RBI data gathering and analysis lags public companies announcing their results by a quarter?

The Quest for Higher Bill Rates

Thanks for all your comments on last week’s post on Local Hiring. Here’s the outline of the key issues we want to tackle in another chapter of the book called The Quest for Higher Bill Rates.

The need for higher bill rates, or rather services/solutions that will yield higher bill rates, is a consequence of two things.

One, with commoditization of major services like Offshore outsourcing, Application Maintenance, Customer service call centers and others (the list gets longer all the time), there is downward pressure on rates. Customers understand the service well and feel that they can manage the vendor to reduce risk. Deal consultants like TPI drive the commoditization even further.

Secondly, with strong growth comes competition for talent. Which leads to wage increases well above the rate increases that can be reasonably expected from clients.

Put together, the pressure on margins is tremendous. It helps that vendor switching costs are high, which mitigates the downward pressure somewhat with existing clients. But the need to do something to protect margins is going to become crucial in the future.

Increasing bill rates can be achieved in two ways. One, by differentiating core services to be able to command a premium over competition. Some services like large scale Offshore Outsourcing deals come with a fair amount of risk. Clients are often willing to pay a premium to a vendor who has a great track record and a solution that meets their needs. Within limits this can work well.

But what really pays dividends is investing in new services. New services are less competitive and the ability to make really high margins is great. For example, in the early days of ERP related services, we weren’t doing end-to-end implementations at Infosys, but revenue growth was strong and the margins were terrific. Why? because there weren’t too many service providers who could do offshore ERP work. The only alternative for clients was to have one of the Big 5 consultants do it for them at exorbitant rates, which left a lot of headroom for offshore service providers.

New services have always made good money. Until of course commoditization sets in. The trick therefore is to be a service innovator. Start early and stay ahead of competition. As the market expands, the early pain pays off in the form of high margin, high growth revenues.

But we are now at a stage in the industry where service innovation by itself is not good enough. The addressable space in new services that are being launched now is much smaller than the markets already being addressed. The impact that the new services can make on the company’s margin is therefore smaller. We may still not be there yet, but within five years, services that are new today will also have seen commoditization and there won’t be enough potential in introducing new services at that time.

This is not to say that the potential for innovation will go away. Quite the contrary. The action will shift from services to solutions – bundled services and IP that tackle a specific business problem. The IP included could be a platform that accompanies the service, or just a deep understanding of the business problem and the experience of having solved similar ones many times before.

By its very nature, each solution will have a smaller addressable space, but in aggregate could offer great potential. Pricing could be traditional time based pricing or it could be by transaction. The key thing is that competition will low and so there will be more freedom in pricing. The client is likely to look at the cost of the solution vis a vis the value it brings to his business.

This is a very profound change for the Indian offshore industry. Their approach to business thus far has been ‘build it and they will come’ – which works fine for services. But for solutions, you have to be out there, in the flow of what’s happening in your clients’ businesses. Identify pain points that can be solved by the combination of technology and services. And then invest the time and money to build a solution. You go from being an expert in delivering a service to becoming an expert on a business problem or process.

It also means that services companies will have to make many ‘bets’. Solutions require investment. How do you decide where to put your money? Or how much. Because of this difficult transition, I think that services companies will largely acquire technology or IP for their first solutions, instead of building it themselves.

How else will this transition from services to solutions affect companies?

What’s the Size of the Offshore Industry?

I thought I knew the answer to this one. Turns out, the correct answer is “it depends”.

The GoI puts out a number which is called “Miscellaneous- of which Software Services” or Software Services in short. This data is available on the RBI website. The number for 2008-09 is $46.3 B (yes, the RBI does give data in both Rs. and USD).

This number comes from the Balance of Payments report. Software Services is actually not clubbed with Exports. It is part of Invisibles, along with Travel, Financial Services etc. – services that can be sold to parties outside the country but are never “shipped”.

This Software Services number includes both IT Services and BPO (and all other variants of XXS and XXO) but includes only revenue from billing done by Indian companies or Indian subsidiaries to their foreign clients or foreign parent companies. The problem with this number is that for an Indian company like Mindtree with no subsidiaries it will be pretty close to actual revenue, but for a company like Cognizant it will be what the Indian sub bills the parent for services provided. In all likelihood this number will be cost plus something like 15%, which is well below the typical mark up on offshore services of more than 100%. Additionally, for Cognizant the entire onsite revenue will be excluded.

I actually didn’t really check if Mindtree has foreign subs or not, but if it did then the RBI number would exclude the subsidiaries’ revenues, including only the Indian parents billing on the subs.

So, as you can see, the $46.3 B number is well under what you would consider the true revenue of the Offshore industry, which includes onsite operations related to the offshore business.

NASSCOM tries to correct for this revenue by including the revenue of foreign subs, but I don’t believe it does anything about the Cognizant situation where a foreign company has a sub in India. In truth, that is a slippery slope and it shouldn’t even attempt it. To figure out the onsite revenue associated purely with the offshore business is impossible to orchestrate over all companies. Imagine trying to do that at Accenture or Keane.

Also, included in the RBI number as also in the NASSCOM number are exports from Captives where onsite operations may not even be meaningful.

Anyway, that answers the question that used to puzzle me for the longest time – why are all the charts for software exports and not the Industry revenue? Sometimes you measure what’s measurable and leave the rest as an exercise for the reader.

By the way, I had been tearing my hair out trying to get the net Exports data for the IT-BPO industry. Finally found it when I came upon the RBI database which is quite comprehensive and easy to use, though difficult to find. I sent some feedback. They fixed the data and sent me an email in one day! On the other hand, I sent an email to NASSCOM’s research department. No reply after a week. Go figure.

Why is Local Hiring in Offshore Services so Sparse?

For some parts of the book that I feel the need to reach out to my blog readers. Your feedback will make a better product.

One of the chapters in the book is on Local Hiring – why Indian services companies haven’t hired in greater numbers and why it might become more important to do so in the future.

The percentage of employees in Indian IT Services companies who are Indian (born and brought up in India) is definitely over 95%. If you leave out the employees acquired through acquisitions, local hires (Americans in the US, Germans in Germany) are a rounding off error. Why is this so low?

Over 95% of the revenues of Indian services companies comes from outside India. 20 to 30% of billable employees are onsite. Shouldn’t you expect a higher proportion of employees to be hired locally? After all, IT Services is a high-touch business. If you are onsite, you are constantly working with client personnel. Cultural proximity, common backgrounds, networks from college and prior jobs must be of great value. Yet, local hiring is still very slim.

There are some good reasons why this might be so.

One, Offshore services is a very unstructured business. Every project is different – client needs, business processes, size of project – can all differ greatly from one project to another. The use of templates is limited to a few project processes only. Most of the project requires “new work” every time which in turn requires a fair bit of collaboration among the project team members – both offshore and onsite. This need for intense collaboration makes it much easier if the onsite team members are actually offshore team members who have moved onsite temporarily.

Then there are cost reasons as well. Not so much compensation which for most companies is within range of what it would cost them to hire locally. But there are other reasons why the costs are higher to hire locally. Like the fact that a local employee would likely need travel and living since the project can’t always be in the metro area in which she lives. Also, for local hires, bench costs are at onsite wages.

Outside of Delivery – in Sales and Consulting – the cost reasons above don’t apply. At one time, there was a salary difference. But now, Enterprise IT Sales and Consulting are both in decline and Indian Services companies have upped compensation substantially. So that isn’t a reason either.

But even here, I feel that companies feel torn between the need to hire folks who could be more effective in forming relationships with clients and the need for them to work effectively with offshore teams. Anyone who has worked in the industry knows that a salesperson’s effectiveness can often depend upon how good his access is to expertise and resources in the company.

The only place where there really are no barriers to hire are in senior positions in Sales and Consulting. Where you get the value of their experience in a certain industry and their networks but on the ground the proposals and staffing of projects is handled by other people. But here too there is a mismatch in expectations.

While Indian companies haven’t shown much urgency in hiring locally, it’s not as if potential employees are trying to break down the door either. Perceptions in the marketplace about Indian services companies are that you are generally “thrown into the pool to sink or swim” with very little support. Also, that policies aren’t as employee friendly as their current employers. You don’t have a life any more and work takes up every waking hour. Although, I think this is the nature of the offshore business, and if they are still working regular hours, it will change soon.

Going forward, local hiring will become more important. Winning business is now less about technical expertise, which is assumed. It is about domain expertise – do you understand my business process well enough? It is going to be pretty tough to build domain expertise organically – through the work the company does for clients. Hiring industry expertise into the company either from industry or from other consulting companies will become necessary to compete.

Also, there is the issue of optics. Can you do X billion dollars of business in a country, with tens of thousands of employees in the country and hire just a handful from the local market? The law may allow it, but you have to do much more in the court of public opinion.

Take Toyota for example. When they started putting up manufacturing plants in the US in the 80s, it was probably much easier to just expand in Japan. But they knew that if they were going to be a significant player in the huge US market, they had to do some local manufacturing. Today, Toyota has manufacturing facilities in many states in the US. When they ran into trouble earlier this year because of their quality problems, their American employees and politicians from the states that have the factories, supported them.

In a few years US or Europe based competitors who are rapidly adopting the offshore model will have a truly global workforce with a (largely) India delivery model. If nothing changes, Indian companies will be almost entirely Indian. The lack of diversity will lead to a lack of diversity of thinking. And exposed to political games.

IT Services Companies Should Empower Middle Management

Last week was quite eventful in the “Workshop of the World”. Foxconn, a Chinese manufacturer for companies such as Apple, Dell and HP, gave a 20% ad hoc raise to its workers after as many as ten suicides which called into question the working conditions at its plants. Fox Conn employs 800,000 workers in 20 plants across China.

Then it was Honda’s turn. Workers in Honda’s four factories in China struck work bringing all production in China to a halt. Yesterday Honda gave a 24% raise to workers, who were still not happy.

The strike in of itself was quite surprising. From FT

The right to strike was excised from the Chinese constitution in 1982, and attempts by workers to organise outside the official All China Federation of Trade Unions are frowned on by Beijing.

Amenities at Chinese factories like Foxconn are actually considered to be good. From Guardian

Foxconn is proud of the fact that it provides a swimming pool and other facilities to its staff, as well as organising chess, calligraphy, mountain climbing and fishing.

At both companies pay is not great but is above the legal minimum wage. Many workers make much more by working overtime.

How is this, in any way connected with the Indian IT employees’ angst? They are both about employees having nowhere to go with their problems.

Even though their demands and managements’ responses have been focused on pay increases, Chinese employees taking on their managements, is not really about salaries. How can it be when most employees come from the hinterland where wages are poor, that is, when there are jobs available? It is because the workers feel powerless. They are lost in these huge organizations. Foxconn has 800,000 employees. Honda also employs a similar number across its four plants. The “official” trade union is not elected and is really part of the establishment – a proxy for management. The workers have nowhere to go with their problems.

Cut to the Indian IT Services industry. Most of the successful companies of today are very centralized in how they operate. Historically, this was necessary. To scale up they had to build an organization which ran efficient, repeatable processes. For that it was necessary to have strong central control. But the very thing that helped them scale engineering and business processes, made the middle management powerless and weakened the bonds between the company and employee. It failed at the most important aspect of scaling a company – in building a loyal, motivated workforce.

When a company is small, the founders or the members of the top management know everybody themselves or with one degree of separation. They infuse the whole company with their values. Employees form a relationship with the company based upon these shared values.

But as the company grows, one degree of separation becomes two, three, four and more. Pretty soon what top management gets to hear is what they hear from their direct reports. What they have to say is said to a select few or to the media. How do you continue to build trust with your employees? You can’t do it yourself. So you must have your middle managers become interlocutors for you.

The problem is that middle managers are so disenfranchised that they feel powerless. They are the ones who run the delivery teams, who make the company tick. But they don’t have the leeway to solve their own day-to-day problems. When they take their problems to their superiors they discover that they too are powerless. So they just keep punching the clock. If somebody in their team comes to them with a problem, they just say, “I can’t help it, that’s the way it is”. When the rank and file IT worker starts griping about the company, some of these managers stay silent. Others join the griping. Nobody defends the company. They can’t. They don’t believe in it themselves. That’s where the battle is being lost.

In the case of Chinese workers, establishing a union that is truly representative might actually be the solution. Empowering middle management is less effective. In manufacturing there is a “class divide” between managers and workers, often based upon education and qualifications. Very few workers will ever be promoted into management. So the “us vs them” feeling almost guarantees strife, especially if as in the case of Honda, the Japanese managers earn much, much higher salaries.

But in an IT Services company every engineer has the qualifications to become the CEO of the company. It should therefore be easier to bridge the divide. Also, regardless of the quantity of outpouring on the internet, it still does not represent widespread disaffection.

Winning back middle management is the first step in turning things around with employee relations. Stuffing their mouths with money just pushes out the day of reckoning.

Indians and Unpredictability

A notice at a neighbourhood Postal Annex. Truly, a picture is worth a thousand words. The proprietor is, you guessed it, Desi.

The notice is a microcosm of Indianness. If you get past the English (hey, its a foreign tongue, so stop being so fussy) it really is a reflection of our relationship with predictability.

There are three kinds of Indians:

– Those that are unpredictable and don’t care.
– Those that are unpredictable, but would like you to expect, and perhaps accept, their unpredictability. The store owner who put this notice up belongs to this set.
– The predictable kind. Within India, this is a very small set.

Indians are not brought up to be predictable in their behavior. The environment (Bangalore traffic for instance) doesn’t allow us to be. But this is certainly a phenotype issue not a genotype one. Because somehow, when Indians leave India they leave their unpredictability behind.

The great achievement of the IT Services industry has been to extract predictable outcomes for clients out of this morass of unpredictability. They erect these boundary walls around the company. Within these figurative walls there are no power cuts and meetings start on time. Defects are measured and deadlines are met. Because that’s what clients in the developed world expect. It’s gotten easier and easier over time, but in the early days the pioneers did the equivalent of moulding square pegs to fit into round holes.

Growth and the IT Services Pyramid

This appraisal cycle has been rough for Infosys. Unfortunately, at over $5B in revenues, everything it does becomes a media circus. Or in this case a social media circus.

Economic Times published a few stories in February and March of this year on a new appraisal and promotion policy at Infosys. The stories were their usual unremarkable fare, but what was truly remarkable was the sheer volume of comments (452 on this article as I post this) and the apparent rage of the commentors.

There are many interesting lessons one can learn from this episode. For one thing, this must have been quite an education on social media to many company managements in the industry. But the thing I find most interesting is that, unfortunate as the situation is, there is very little that Infosys or any other company can do about it. As growth slows down in the IT Services industry, career growth must also slow down.