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Wipro variable pay now linked to staff's accounts

Last updated on: May 2, 2011 12:24 IST

Wipro variable pay now linked to staff's accounts

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Bibhu Ranjan Mishra & Pradeesh Chandran in Bengaluru

Wipro, the country's third-largest information technology services provider, has decided to link the variable pay of a majority of its employees with that of the revenues they generate out of their respective accounts.

This is part of a restructuring where the company has given more decision-making powers to the business divisions ('verticals').

Linking pay to the growth of an account, it feels, would enable better mining and growth of top accounts.

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Image: Wipro employees.
Photographs: Reuters
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"We are looking at creating a customer-centric model wherein we will bring all channels, including the sales, solutioning and delivery people, together. We will align about two-thirds of our IT employees to this model, who will be responsible for the growth of their respective accounts.

"Now, their variable pay will also be linked to be the revenue they generate out of that account in terms of share of wallet," chief financial officer Suresh Senapaty told Business Standard.

According to sources in the company, variable components are 10-14 per cent of most employees' total cost to the company and this 'performance-linked compensation' is given quarterly.

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Image: A Wipro unit.

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Earlier, the variable pay of most (especially software engineers, developers and programmers) was linked to individual billability, which was correlated to overall performance of the company.

Even if a particular business unit, vertical or account performed exceptionally well, this was not necessarily reflected in the variable payment of the employees deployed there.

Wipro is also planning to turbo-charge the growth of its top 60 accounts by allocating dedicated resources.

The top 60 customers account for about 70 per cent of its total IT business.

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Image: Wipro campus.

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"We are making sure the top 60 accounts are serviced mostly by dedicated resources than shared resources.

"With this realignment, these resources would be responsible for the growth of those accounts they are responsible for.

Through this, we want our employees to deliver huge customer satisfaction, so that customers will not give up the job," said Senapaty.

Adding: "Though our customer addition was comparable with most others in the industry, we were not good in mining those accounts.

"We have been talking about empowering the verticals to enhance client engagement activities. But this was not happening properly. We have rectified this now."

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As part of the restructuring, Wipro says it has now given adequate decision making powers to verticals, who will remain as the single axis instead of the earlier three axes -- region, vertical and practices.

This has started paying dividends. In the quarter ended March 31, Wipro succeeded in growing two of its large accounts to contribute $100 million of business for the company.

This took Wipro's total number of $100 mn-plus clients to three in the quarter from one in the earlier one.

"Our top 10 accounts have also grown faster than the company average in the last quarter," said Senapaty.



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