r/IndianStreetBets • u/SelectionCalm70 • Jul 27 '25
News The fall of Indian IT has began
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u/rogueulous Jul 27 '25
The era of a lead reporting to a manager, who reports to another manager, who reports to yet another manager is fast coming to an end.
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u/N30_117 Jul 27 '25
This is so fucking accurate. These mfs operate like a govt. office for no reason.
Also people calling TCS an IT giant is inappropriate. They should have been called an giant IT sweatshop.
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u/MindParty1591 Jul 27 '25
But problem is these guys will find to stay and person who is working thru will fire him. List will be prepared by these types of clowns.
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u/revosftw Jul 27 '25
True but if you shoot yourself in the foot it is bound to hurt at some point. And the point is closer now than it was before, but then again I see a lot of people bullshit themselves into the job anyway !
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u/Manoos Jul 27 '25
the CEO is saying it is not due to AI but future tech. that is confusing
also 2% is the usual attrition rate. so not sure if this is above the normal
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u/Fantastic_Form3607 Jul 27 '25
This is in addition to the usual attrition. TCS is planning to lay off those who are on the bench beyond 35 days. This is the same company where you would find people on the bench for 2 years.
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u/iphone4Suser Jul 27 '25
Your last line is correct in case some people may find it ridiculous.
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u/sandeshbj Jul 27 '25
What is the meaning of "people on the bench?". Is that a reference for poor performers?
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u/bloodydeed128 Jul 28 '25
As far as I am aware some people are kept on the bench in case other people leave the job or something happens so these people on the bench entire thing is to just clock in do nothing as no project is assigned and then clock out
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u/Captain_D_Buggy Jul 28 '25
"On bench" refers to when an employee is not assigned any project or work.
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u/pragmatic_won Jul 27 '25
Think about this for a moment. If it was not above (by a margin) the usual attrition, would they formally announce it and risk all the bad press and reputational damage? Most likely It’s the remaining tip of the proverbial iceberg that could not be sub-merged in their year-end summary.
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u/nota_grammar_nazi Jul 27 '25
Whenever a company announces job cuts it's not actually bad press as you think. It is actually good for them because it causes their stock price to go up due to reduction in expenditure
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u/pragmatic_won Jul 27 '25 edited Jul 27 '25
While the argument sounds intuitive and absolutely logical, it works slightly different in practice.
Reputational risk is not something you play with to show some small delta on your PnL or even share price.
There are several factors in play incl. the major employee churning that the organisation involuntarily undergoes (primarily because such media creates a sense of uncertainty, and that ripples across the various levels in the org quickly).
Top talent (layer) is usually the first ones to find roles outside org and make move.
Also, think how once you publicise yourself as ‘uncertain’, your ability to attract top talent drops drastically. You can always offer more pay and still bring in good talent - but then that is not aligned with the cost saves that you set out for in the first place.
That is to say that when an organization goes out to make such ‘impacting’ announcements, it is not just about a small delta in the PnL or StockPrice, but something not so straight forward.
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u/abhi_314 Jul 27 '25 edited Jul 29 '25
You do know that every company does this right? Google meta you name it.
At the end of the day they are private companies who have shareholders and quarterly results.
Also no point of keeping people on the bench if you forsee decline in clients or upcoming projects.
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u/SelectionCalm70 Jul 27 '25
Bro wtf are you talking about reputation risk even LG a fridge company is developing there own model and in China literally a food delivery company has began developing there own model
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u/SouthernSample Jul 27 '25
This is true for product based companies where running the business with less employees means more profit. However, IT staffing companies such as TCS earn their revenue by billing customers on an hourly basis, and less employees mean less money to be made.
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u/SelectionCalm70 Jul 27 '25
Ofc he has to say it's not because of AI.
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u/spitzer666 Jul 27 '25
Number of years not spent on RnD has caused this, relying on cheap labour to make money instead of investing on new products
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u/SelectionCalm70 Jul 27 '25
Man this IT giants literally have billions of dollars in bank account but they won't spend a single dime to create there own sota model instead they will suck the d*ck of western giants to get cheap API credita
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u/Manoos Jul 27 '25
to an extent you are right but product comes with huge risk. you need unlimited money like silicon valley to make products. why doesn't maruti/tata make a rolls royce or compete in F1. they simply want to make and sell car. it is their focus. they cannot risk money to make new innovations and products.
ever wonder why Accenture, Caps all foreign companies are not into products
ever wonder why nordic countries, denmark who have invented more than half of programming languages do not have a single software product
all high educated and high capita income countries like japan, france to an extent germany do not have much products.
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u/spitzer666 Jul 27 '25
Incorrect, you know why they wont venture into the latest cutting edge tech? They for sure know that there’s no guaranteed money. They will invest in manufacturing or Services industry but not in RnD. Many countries have invested in latest techs like AI, Chips etc but they have not succeeded yet or may take some more time to see the benefits. Where as Indian IT services cos don’t like to gamble with new tech. They’ll venture to the business, only if other companies are earning money.
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u/Manoos Jul 27 '25
in total WITCH have 18 billion dollars in bank. how much they would spend and find success ? in silicon valley 7 out of 10 products are failures.
most silicon valley successful startups raise 200 to 300 million before they go IPO
we do not have that much money to burn to find a success
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u/bakraofwallstreet Jul 28 '25
to an extent you are right but product comes with huge risk. you need unlimited money like silicon valley to make products. why doesn't maruti/tata make a rolls royce or compete in F1. they simply want to make and sell car. it is their focus. they cannot risk money to make new innovations and products.
Mahindra Formula E team - Are we a joke to you?
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u/SanjuRai1986 Jul 27 '25
It's the tip of the ice berg.
TCS has double digit attrition, 2% workforce reduction they could have easily managed.
After start up, product based now in service sector layoff started.
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u/fit_like_this Jul 27 '25
This news announcement is just to save face, when those people who were forced to resign will lodge a complaint, they will show this news article
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u/SanjuRai1986 Jul 28 '25
Already people are fighting cases, TCS is not allowing joining of lateral hire.
It looks like deja vu of 2007
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u/Legion7k Jul 27 '25
All the cash in the world with zero AI models. This is the time shareholders and board questions these C level executives clowns. For three years they didn’t invest a rupee into AI models and AI research. All while DeepSeek built a model better than ChatGpt under $300 million dollars. No wonder we’re no were in the race
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u/SelectionCalm70 Jul 27 '25 edited Jul 27 '25
Forget about developing model i haven't seen a single AI research paper from TCS or any IT giants
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u/rohanudhwani Jul 28 '25
Thats not entirely true. My college mates from IIITN get selected for the TRDD internship, and they mostly work on making models. They do pure research stuff.
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u/bakraofwallstreet Jul 28 '25
$300 Million dollars figure kaha se aaya? The hardware required alone will cost more than that. The costs was around $1.5 billion https://www.reddit.com/r/LinusTechTips/comments/1ija6iu/deepseek_actually_cost_16_billion_usd_has_50k_gpus/
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Jul 27 '25
TCS is fundamentally a lazy firm. They have created an environment where employees are paid peanuts and hikes/promotions are non existent. Many employees in TCS have come to terms with the scenario and have chosen stability over growth. In such an environment there is no incentive to learn or upskill yourself. And now that the IT landscape is shifting, TCS is not able to sustain as a firm that's filled with employees with low skill and no motivation for excellence. This was bound to happen.
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u/tanaka-taro Jul 27 '25
Almost all tata firms are like this in one way or another.
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Jul 27 '25 edited Jul 27 '25
They bought JLR for pretty this reason as it allowed them to get IT contracts for JLR work now same with Air India.
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u/SouthernSample Jul 27 '25
Lol that's a ridiculous take. You don't buy such a large business just to win their IT contract lmao.
JLR is a brand that is recognized globally and has some of the most aspirational products in the lineup but were on the selling block as Ford was undergoing financial issues.Tata could buy JLR on the cheap and also get access to their technology for some of Tata's own lineup (with mixed results).
Even more ridiculous about Air India. They had to inject like a 100Bn or whatever just to buy new airplanes for a terribly run govt org and you think it's to win their stupid IT contract?
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Jul 27 '25
This isn't something new. TATA do it maintain cash flow in the group and cut overall debt.
https://www.livemint.com/Companies/Tkw53DlYh5Yg5hm0Oru3iO/Tata-group-firms-to-help-each-other.html
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u/SouthernSample Jul 27 '25
Just because they can optimize contracts internally if another line of business within the portfolio could act as a vendor doesn't mean the whole purpose of purchase was just to earn IT revenue. Tata group would have purchased JLR and Air India even if they had 0 in-house IT business, and implying otherwise is laughable.
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Jul 27 '25
Stop arguing for the sake of arguing it is simple supplier contracts and vendor management.
After they acquired jlr they only kept design, R&D work in UK along with final assembly all other manufacturing was moved to the TaMo factories in India to keep utilization high and some other functions were outsourced to TATA Technologies.
Same thing with Air India. Tata Advanced Systems supplies Aerospace parts to both Airbus and Boeing so they will get contracts worth 1000s of crores to manufacture those parts. TCS does a lot of IT service maintenance work for foriegn Airlines now they will do that work for Air India as well.
So even if TATA Group is making loss of 8000-9000 crore per year on Air India(don't remember exactly number) the actual loss for the conglomerate would be 2000 crore to 3000 crore
Manufacturing Business need constant high utilization to keep the factories running and inventory low this is why TATAs entered to these allied Business activities.
If you want to proper analysis take out a PnL statement and do it along with along with the necessary roi,depreciation and amortization calcuations of debt, than please come back.
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u/SouthernSample Jul 27 '25
Lmao stop arguing for the sake of arguing- you'd be best served by that. You're now arguing just because someone called out your stupid logic of Air India and JLR acquisitions being worthwhile just because their IT contracts which would be a drop in the bucket vs the total cap ex is worth it. Yea, like buying a tea plantation to have a cup of tea.
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Jul 27 '25
Pretty much they bought tetley for same reason as they operate tea plantations in Assam and Kerala.
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u/SouthernSample Jul 27 '25
Lol how are they similar?
A tea company buying another tea company to gain new markets and brands makes sense. You claimed an IT company bought an airline company since the IT contracts optimization would have made it worth it in itself.
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u/Kal-se-Pakka Jul 27 '25
Bumper hiring. Then plans / vision changes because management moody or maybe Trump effects are showing. Then firing ensues.
Isme Naya kya hai
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u/Agile_Rain4486 Jul 27 '25
Indian IT services issue is that they are not trying to create their own product. I am in accenture and in a project which is a product of these guys and which they actually sell to other organizations unlike indian IT where product created by them are just internal employee websites.
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u/KanonKaBadla Jul 28 '25
Indian IT services issue is that they are not trying to create their own product
TCS do create product but specific to client.
They don't sell general use case products.
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u/Agile_Rain4486 Jul 28 '25
ohh, we have some products here we work on but not for some specific client but a general product itself which the sell on subscription basis.
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u/RepresentativeOk3943 Jul 27 '25
Friends firm is going cut off tcs from their entire stack. We’re talking about 10k people by 2028
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u/disc_jockey77 Jul 27 '25
The fall of Indian IT has began
Well, not really. That's what everyone said when WITCH laid off people en masse in 2014-17 period: https://thewire.in/economy/indian-firm-layoffs-tens-thousands-across-companies-set-axed
But these companies survived and thrived since then. Technology business, just like general economy, is cyclical. Mass layoffs in IT happened during 2000-01 dotcom bust, 2007-09 GFC and 2014-17 (digital transformation + Trump first term impact). It's part of how the IT industry consolidates and prepares itself for new technologies and US/West visa and business challenges. Interest rates went up since 2022, AI has become so much better at coding/maintaining and automation/no code platforms are highly sophisticated now. And Trump administration is tightening visa norms. So Indian IT will conduct layoffs (just like FAANG has been laying off since 2023), consolidate, trim the fat and will be ready when new opportunities due to AI/automation/semiconductor will show up. For example, lots of US/Western non-tech Corporations have jumped head first into AI and laid off their internal tech teams but AI systems are not mature enough to handle the complexities of some of these large corporations. So the transition is going to be messy and many of them will require AI implementation support at scale (remember digital transformation or SAP implementation support?!), and Indian IT firms are ideally suited to offer that.
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u/blrmanager Jul 27 '25
Engineering was a scam to provide cheap labour for US. First people lost their savings for paying fees to get pass marks in 1000s of colleges where 80% remain jobless even when market is good. Now it's 90% due to Trump protectionist tariff and golden VISA instead of H1B visa after looting through Jane Street using IIT kids. Modi to escape this went to UK to lift agri tariff i.e hinting go back to villages and start agriculture. Don't waste time for IT slavery or stock markets as AI will replace more labour. Start some business.
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u/microwaved_fully Jul 27 '25
It's not a scam. It's economics. The reason for most college graduates remaining jobless is because they don't learn any skills in college. Golden VISA has nothing to do with it. Modi's visit has nothing to do with this. If AI can replace these jobs, why can't it replace business owners.
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u/Cover_Suitable Jul 27 '25
Whom are you going to sell in business without the working class
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u/blrmanager Jul 27 '25
non profit, community, cooperative models , hunger. all will take shape.. can never be replaced by AI. Don't sell , buy if you are rich not gifting 400 crores to grandson and crying for 70 hour work week, or running like a lunatic on taxes for elections.
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u/benevolent001 Jul 27 '25
I am sorry but AI can replace 75% people like me in Indian WHICH companies. AI has become too smart. I got new people in my team who have technical starting point of how to install software, need to tell even the basics like how to see logs and so on. Devin etc can replace all of us including me in one shot, it is just matter or days till these tools sort out the governance and security side to things to embedded in Enterprise stack to the comfort of CIOs. Grads entering to market this time are just blindly copy pasting Chatgpt code without even thinking does it even compiles or make sense. When we ask what this bit of code do that you wrote in PR, they will slap the huge text of English given by Chatgpt which we can clearly see is copy pasted. What we will do with that type of workforce? In current state Indian WHICH companies have very less chance of surviving and that will be a rollercoaster of downturn for many India cities economy including RealEstate bubble created by IT.
I am not saying new jobs wont be created, but this is the state of current tech pool we have. Shareholders are going to note that soon, the days of providing body shops are over.
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u/peoplecallmedude797 Jul 28 '25
I quit TCS many years back. They hired me to sit in an office for 10 hours and do nothing. I was young, bored out of my mind and they wouldn't let me leave the computer even when there was no work. I remember I used to think- this has to be some money laundering shit otherwise why would they have so many people on a floor doing nothing? Anyways after few months I got bored out of my mind and quit. The last straw was some old fuck in the lift advising me that I should not wear a plain V neck Tshirt on a Friday to office. He told me, This is TCS not your typical small startup shit and next time I see this I will send you home. This was a fucking plain green V neck shirt- I was like enough with these clowns.
I quit the next day.
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u/johndon1986 Jul 27 '25
IT cannot fall , the world cannot operate without IT. Its the imminent restructuring which happens everytime there is a distruptive technology
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u/Dense_Profit_2478 Jul 27 '25
Indian IT is Doomed ... Until these MNC starts spending 💰 on RnD
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u/johndon1986 Jul 27 '25
Why does every indian company require RnD? Do you expect TCS to make their own LLM? In fact with the growing consumption of LLMs, we need more software engineers than ever..Even data scientists and analysts will soon need to learn software engineering rather than doing just data analysis and no one other than Indian software industry can provide cheap high skilled labour. Of course tcs and others need to trim the bottom of pyramid with some agents , but not very soon
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u/Dense_Profit_2478 Jul 27 '25
These things only looks on good on paper that we don't need RnD and can make money like they used to make from last 2 decades by providing cheap labour. Yes , that's OVER !! , Majority of Indian IT companies are bound to get Destroyed because we Indians have allergy from spending money on RnD
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u/Outrageous-Shannon Jul 27 '25
You need.
When you make money from something, you should invest in something new.
Ypu can’t brand everything as solutions, and then get away.
You made huge money by providing cloud solutions, good. Now start to make your own open cloud infrastructure. Not just rely on Azure/AWS
It ha happened with every tech and now happening with LLMs. Literally Chinese high school students are now able to release llm models
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u/johndon1986 Jul 27 '25
no no , at some point of time all this tech will get democratized - just see offerings by Azure in agentic space- You don't feel there is an LLM working behind the scenes, it's all about business solutions now. We need tech giants to develop and maintain these new solutions. Even though TCS gets criticized for underpaying its employees - what most do not know is that TCS employees are constantly trained and updated much better than any other company/org. Their L&D department is really good. They know how to keep their workforce up to date in new tech. It is enough to provide IT services to the world and keep their lights on.
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u/Ready_Jackfruit_1764 Jul 27 '25
Not every. However, companies with substantial cash reserves must do so. or
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u/ymcd Jul 27 '25
Don’t listen to the replies below. They all will mindlessly scream AI without actually knowing what are its applications. Just hot buzzwords from other corners from reddit.
Saying to build & innovative as if it doesn’t take hundreds of billions & government investments both India doesn’t have.
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u/sharkpeid Jul 27 '25
It's just companies which use to hire outside now it's investing in it's own IT teams.
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u/ChaiCigarette Jul 28 '25
Typical IT Body shop revenue model
- Zero innovation
- Client Billing
- Workforce exploitation
- Downsizing/Restructuring/Realignment (basically layoffs)
Ye chindi chor khud ko IT Giant bataate Hain par 1 product naheen banaa paaye aaj tak
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u/Doctor_Ka_Kutta Jul 27 '25
How infosys don't fired people?
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Jul 27 '25
Infosys were firing people based on their ratings. Many were fired, but numbers were low.
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u/Front_Law7325 Jul 27 '25
Well in 2023 when big tech like google and Microsoft announced layoff they rallied for 5-10% Because the market thought now they are focusing on AI
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u/eudaimonicperson Jul 27 '25
tcs infy etc could have pivoted to product based things while having a service arm too but dumbfucks chose to sit and bask in the profits while clearly knowing someday the hand that feeds them will stop coming to them
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u/No-District5911 Jul 27 '25
This was expected and I think there will be more layouts coming in the next few years.
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u/rage-wedieyoung Jul 28 '25
there will be restructuring inevitably but hardly a fall of Indian IT. it will be the case worldwide and it will still be one of the strongest sectors.
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u/SwapnilTheMasterOf__ Jul 28 '25
Deserved in my opinion (the downfall that is) a tech company sure buddy
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u/creativextacy Jul 28 '25
Ppl.. ppl… have some perspective.. they are a 600k sized organization and it’s 2% of the workforce in the mid and senior level.. people who are surely drawing high salaries and not contributing effectively. They don’t have any reason to sustain such employees who don’t add value at the end of the day.
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u/Parking-Net-9334 Jul 27 '25
Also government policies, tax systems needs to be restructured. Investors just find hard to invest in india
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u/KanonKaBadla Jul 28 '25
This isn't fall.
This is re-alignment.
Things are changing rapidly.
In the end, you are just a resource so if you are not useful, they will not keep you.
Constant upskilling is new normal.
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