The US based IT service firm, Cognizant is executing a slew of measures to bring down operational cost after it recently cut down its revenue guidance to almost half for 2019 after underperforming in Q1. The company even announced another round of layoffs in the last week as part of its restructuring effort. Even last year, several senior executives were asked to leave amid layoffs at Cognizant.
Another bad news for Cognizant employees is that the company will now be reducing the grace time it gives to non-billable resources or the ones on bench. Cognizant currently offers 90 days of grace period to employees that are not working on billable projects. The tech firm is bringing down this grace period from 90 days to 60 days. This means if the company does not find billable project for these workers within 60 days, they could be asked to leave.
The employees get the initial grace period of 30 days by their respective business unit, then they are moved to a corporate pool, where additional grace period of 60 days is offered. According to sources, this 60-day period could be reduced to 30 days. The growing number of non-billable resources in Cognizant is forcing the company to make this move.
In a conversation with TOI, a Cognizant spokesperson said, “We have no more information to share not his beyond what we said during our recent earnings call. We have made no announcement since then and will not comment on rumours and speculations. Our goal is to accelerate revenue and margin growth with a performance-based culture, and we are taking the necessary steps to position Cognizant for improved commercial and financial performance. It is important to note that Cognizant’s Q2 revenue was at the higher end of guided range and beat consensus EPS estimates.”
Cognizant is now expected to layoff few hundred employees in the infrastructure services business. The steep drop in Cognizant’s growth rate for the previous quarter has pushed the company to initiate headcount restructuring.
Source:https://content.techgig.com
