IT giants lock horns in poaching brawl

When Cognizant was not performing well, many of its rivals poached many senior executives of the IT firm. Now, the phenomenon has reversed with a lot of senior management staffers joining Cognizant. It seems the competition of large deals and enthusiasm to build team as new CEOs take over in some companies, are driving such events - Says a HR expert involved in senior level executive hiring process

Talent War

• Wipro initiated legal proceedings against two senior staffers
• Infosys reportedly sent letter to Cognizant alleging unethical practices
• Many see talent war to intensify as demand environment looks challenging
• Trend of executive poaching likely to continue in 2024

Bengaluru: Talent war between IT services companies, especially for top level executives, has intensified in 2023, leading to legal fights in some occasions. In the recent weeks, both Infosys and Wipro have toughened their stance with regard to CXO level poaching by rival Cognizant, prompting them to send legal notices to some of the executives, who had quit these firms.

Sources in the know said that such legal fight for top level executives may intensify as competition for large deals become sharper amid a slow demand environment.

“When Cognizant was not performing well, many of its rivals had poached many senior executives of the IT firm. Now, the phenomenon has reversed with a lot of senior management staffers joining Cognizant. It seems the competition of large deals and enthusiasm to build team as new CEOs take over in some companies, are driving such events. If the demand environment deteriorates further, we may see many such movements,” said a HR expert involved in senior level executive hiring process.

In an interesting development, Infosys and Wipro have been at loggerheads with peer Cognizant as many senior level employees of the former two firms joined the latter in recent quarters. According to reports, Infosys sent a written communication to Cognizant after a number of its senior personnel left to join the firm.

Since taking over in January of this year, Cognizant CEO Ravi Kumar, who is an Infosys veteran, has hired over 20 executive vice presidents and four senior vice presidents, many of whom are from Wipro and Infosys. Most notable was the joining of Wipro’s former Chief Financial Officer, Jatin Dalal as CFO at Cognizant.

Wipro has now filed a lawsuit against former Chief Financial Officer Jatin Dalal and executives Mohd Haque just days after they joined Cognizant.

The legal proceedings against Dalal were initiated by Wipro at a civil court in Bengaluru. Following the initiation of the suit by Wipro, Dalal promptly submitted an application and asked the court to refer the matter to arbitration, some reports said.

Sources in the know said that many senior executives have been looking for better opportunities as bonus payout turns to be lower.

“Senior management compensation is very much linked to performance of the company. As IT firms report low revenue growth rate with margin pressure, many of incentives linked to stock prices and other parameters are likely to be low for FY24. That is the reason many of the senior executives are looking for greener pastures,” said the senior HR executive.

In the coming quarters, movement of top-level executives is likely to be higher as scope for revival in demand seems low in 2024.