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Infosys iRace : what went wrong?
iRace – Infosys’ new employee development plan
Authors Ankush Gupta – G10068 Bhushan Vilas Kale – G10073 Lisa Mohapatra – G10085 Nikhil Uppal – G10092 Sushant Sudhir Joshi – G10114 11/19/2010

headcount increased almost by 1 lakh. was started in 1981 by seven people with US$ 250. it has become symbolic of India‟s IT growth story. Every second out of six software engineers are associated with or have worked for Infosys in their past. During this period. China. Infosys Technologies Ltd. Revenue also increased from $754 million to 4. IT infrastructure services and business process outsourcing. Infosys was also growing outside the traditional IT business areas such as China.468 employees as on September 30. . 2010. the Czech Republic. Australia. Why iRace – Where was the problem? Infosys has been with existing role based structure since 2003. new development centers (DC) were built. technology development and innovation. One of the largest employers of the young budding talent of India. product engineering. Russia and South America etc. maintenance. Infosys has changed the way the world looks at India. It has a global footprint with 63 offices and development centers in India.Three out of five authors of this case study have worked for Infosys in the past. iRace Initiative Infosys Technologies launched its iRace (Infosys Role and Career Enhancement) program in June 2009. This growth brought its own set of challenges with it. Global education center which is state of art training facility was built at Mysore. increased focus technology assistance.4 billion. Canada and Japan. Infosys defines designs and delivers technology-enabled business solutions that help Global 2000 companies win in a Flat World. This was also the period during which IT business grew leaps and bounds owing to economic growth. application services. Infosys has been voted again the 'Most Admired Indian Company' in The Wall Street Journal Asia 200 online poll.6 billion. systems integration. During this period approximately 50 thousand employees left the company and 1. Poland. reengineering. It has placed the Indian youth and talent at a different platform altogether. Today. Company Background On its 30th anniversary. independent testing and validation services. custom software development. the UK. an HR initiative aimed at career restructuring and better alignment of roles and responsibilities with business needs employee aspirations. The company has achieved this distinction for nine years in a row.5 lakh employees joined. The offerings span business and technology consulting. Exhibit 1 gives the details about Infosys headcount and revenue change from 1996-2010 There was a growth in geographical terms as well. it is global leader in the "next generation" of IT and consulting with revenues of US$ 5. Around 30 % of students in the General Management Program at XLRI have been associated with Infosys. Infosys and its subsidiaries have 122.

but did not provide details of whether the role played was in an engineering. Many new positions. This collectively resulted in disparity at role. Cognizant. Here are few other reasons that lead to the IRACE implementation: 1. Maturing software development process also contributed to this in its own way. 3. new opportunities came up very fast. responsibilities. capabilities and experience level not only among the Industry players but also within the Infosys among various industry players. For example. The job descriptions were defined as a group of tasks for a designation in a particular function. Create a mapping of roles and designations across functions like Technology. a „Software Engineer‟s‟ Job description would include tasks like Analysis. and Tech Mahindra chose different path. Companies like Satyam. Align the unique Infosys hierarchy with the Indian IT Industry standard. Software programming. Many new roles came into existence as a solution of some local business problems. Employees complained that they did not have opportunity to continue working on technology instead of moving to project management roles. Thus iRace – Infosys roles and career enhancement was developed. During the same period IT landscape changed at a very fast pace and various players in industry expanded. HP.5 years moved to management roles. 5. Fast paced growth. Consulting. The job descriptions were separately defined for each designation and did not provide much clarity on the role played by the particular designation. Business Development and Account Management. quality assurance or consulting capacity. IBM. Design. managerial. India also became the destination for various IT MNCs such as Accenture. As a result roles performed by people at similar position differed across business units. 4. 2. Infosys was losing on its technology assets and it was observed that people with little experience of 3. Define the roles at various designations more elaborately to facilitate management and help the employees understand their roles better.With increasing growth. client demands led to forced transitioning from technology oriented roles to project management roles. roles came into existence owing to new businesses and technologies. Recognizing the challenges Infosys chalked out the plan to take relook at the employee development plan. Indian IT giants like TCS. . This resulted in shortened technology experience for many employees. Wipro and Infosys adopted own methodologies. Software Testing and maintenance etc. so that employee movement across functions with-in Infosys can be managed better. Facilitate better evaluation of performance through improved role clarity and hence improve the Performance Management system.

Mapping somewhat looked as below: Role Role Designation Job Level Job Sub Level 3A 3B 3B Personal Level Personal Level 3A Sub Systems engineer Senior Systems Engineer Systems Engineer 3 Systems Engineer Trainee 3 3B 3B Similar mapping was present for various roles New roles were created for specific purpose and had definite eligibility criteria. It started with first phase mapping of entire employee strength followed by hiring and promotions based on the results of the mapping. new set of roles were created. the appraiser creates tasks performed by Performance management tool. appraise in the . Performance measures for each role based on role were prepared. These roles were further had some sub roles as well. For a particular appraisal cycle. New set of “Job Levels” and “Personal Levels” were created and mapped to new roles under iRace. Job description and responsibilities were prepared for every sub role. The last step in the process was performance management wherein employees were rated for compensations and promotions based on their performance. These levels were further classified into sublevels. Various role profiles were compared across the business units and geographies. Performance Management Process Following is a brief of the Performance management process which was followed by Infosys: 1. Refer Exhibit 2 and Exhibit 3 for pre and post iRace hierarchy structure. As part of iRace all the roles were consolidated together. After thorough analysis of the roles and responsibilities performed by people at different roles. Along with this Infosys also decided to change it old band based system in which person was having a job band and personal band. The next phase was defining of the role paths which provided an opportunity for the employees to choose between various domains and departments.What is iRace? The iRace program comprised of four parts. Competencies required to carry out particular job and shoulder the responsibility were clearly identified. These competencies were further classified into Professional and Behavioural categories. New role named “Technology Lead” came into existence through this process.

3. Changes in Performance management system PMS was modified and goals were introduced instead of tasks. was task based and objective evaluation was not possible due to various issues such as subjectivity of tasks. Moreover the system was designed and created when Infosys was less than 20000 people. 5. This has resulted into customer delight and customer has communicated the same to employee and/or his/her manager verbally. The original system. 6. Appraise is compared only with people performing similar roles and having the same skills and experience levels. events or any recordable mater dynamically. The tasks of appraise are defined according to the experience level. The appraiser then evaluates the performance based on his feedback and feedback from other parties if needed. Problems used to delay the process eventually stretching the process thereby delaying rolling out grades and salary increments. Capability and competency parameters were introduced in the system and system was configured to capture the objective data. Scale added its own complexities and challenges to system and existing PMS was not able to cope up with those. The rating and the Consolidated Relative ranking decides the revised remuneration for appraise. Common situation would be say. Person had to wait until the performance evaluation process to enter these detail in system and by then its significance or weightage may come down. each appraise is evaluated in comparison with his her peer group to form a consolidated relative ranking. The form is sent to appraise where he puts in comments about his performance and provides a self-rating for each task. The rating provided by the appraiser is signed-off by appraise. as mentioned previously. It can be observed that it is important to ensure the following to conduct the process mentioned above effectively: 1. This made system very subjective and vulnerable to personal biases and criteria. 4. Apart from this rating. 2. an employee has solved one very critical software issue or found out a defect in software logic which is existing since long time. This exceptional performance needs to be recorded somewhere as its importance would decay with time. lack of objective data capture. Many a times closure of one cycle and beginning of new cycle had very little time interval. These problems usually would travel upwards. skill and the role played by appraise. With . This was causing headache to various project managers during the performance appraisals of appraise.2. and may not be even recognized as exceptional one during the appraisal. Another issue in the system was its inability to capture the feedback.

Such sessions took place at every location including onsite covering each and every individual employee. Mismatch as discussed above 2.5 years of experience to be a Project Manager. In fact iRace had become the discussion point of any meeting. Many queries remained unanswered and especially boundary cases suffered due to lack of clarity about their new roles. Above all this entire exercise disturbed the entire organization. Some . Though the new PMS launch was a soft launch.g. Though the intent was very clear. it attracted employee anger. Role fitment exercise has resulted into mismatch at some levels like existing project manager was classified as technology lead according to iRace criteria. People continued to play vague in the process and maintain the ambiguity in the role boundary. result was very disappointing as at most of the places questions were not answered precisely. iRace could not give the clarity to employees about their responsibility and roles. Now employee has to provide the data objectively against each goal and has a matrix of evaluation associated with every goal. Refer Exhibit 4 for new process flow. Many employees had their next role changed delayed due to new criteria.this new performance management system was built to evaluate the person based on goals achieved and capabilities & competencies available with him. in older system person needed minimum 5. Post launch reactions and events Our survey reflects that even after such clear job description and objectivity in the process. Launch and communication of iRace and PMS IRace anchor was identified for every business unit. Employees expressed their feelings during the appraisal discussions. E. Goal setting for the next cycle is done by employee and his/her manager during this process itself. (Soft launch system was capable of performing appraisal with new features mentioned. Goals were set and evaluated but not used for arriving at rating) And the fact of the matter was that this was just appraisal as Infosys had decided not to give any salary hike due to recession. Typical format of this communication was the speech address by identified person followed by question answer session. He/she also has to answer more than 40 questions based on his/her role for the purpose of capability measurement. iRace changed that criteria to minimum 8 years of IT experience New iRaced based PMS launched along with this in second half of 2008. There was change in the appraisal process as well. This was a new system and even managers had limited idea about this. New Roles Job levels and personal levels were communicated to employees individually through e-mail. various forums very explicitly. Boundary cases where person has missed next level by very short experience ( ranging from 1 day to 1 month ) 3. but the existing process flow and task method was followed). This resulted into further confusion and chaos at appraisal level. Many people were not happy with this due to following reasons: 1. Anchor along with senior people from employee travelled to various locations and communicated the iRace philosophy to respective units in person.

These task forces were assigned the tasks of evaluating systems like Employee satisfaction. Some of the changes suggested were accepted and rolled out immediately where as some were noted for further action. Many boundary cases were identified and correction exercise was carried out. Presentations were made to Infosys higher management (including some board members). Each task force had participation from all the levels. the implementation could have been smoother had the communication been more effective in terms of addressing the 'major' concerns of employees during pre-roll out communications and more buy-ins created." The change has brought about more disappointments in the employed and attrition rate has increased. CRR process etc. "iRace is a good thing to happen. However. In these times of ever increasing competition in a dynamic business environment. Blog received more than 5000 comments in just one day. The 'Adoption' stage was not thought of clearly. At the same time Ms Nandita Gurjar. It will help the organization to create more value for the customers in medium to long term. iRACE was a large change management exercise with an organization wide impact and like any other change it was bound to see some resistance. A task force focusing on various aspects of employee development was formed. . Performance management system. People expressed their emotions freely on social networking platforms and blogs. This was a flash point for employees and everyone including software engineers to delivery managers posted their comments on blog criticizing iRace and Infosys pay policy. Management response and reactions Later on management corrected the mismatch where most of the mismatch cases resolved with people retaining their existing titles. and people who did get their promotions (expected) did not get the salary that they would have got had they been promoted just a year earlier. Media also jumped onto this issue and had substantial news coverage about Infosys iRace.SVP HRD.people have written and spoken about it very clearly on internal blog site and bulletin boards. for a fast growing organization like Infosys it was imperative to have a career architecture program to be able to create a differentiation for long term sustainability.but its implementation was seriously flawed. certification policies. iRace was a hot discussion point everywhere in Infosys. posted a blog on internal website which criticized the employees. People expecting promotions were denied.

New performance management system changes failed to connect the employee concerns even though it empowered employees for objective assessment. of years of experience. Proper buy-in Proper buy-in had not been created . it failed to improve the performance of the processes – performance management . In addition to that iRace hit the road block on account of following issues The timing It was rolled out during the time of recession giving the impression to the employees that it is being rolled out only to tighten employee benefits by downgrading roles and raising performance benchmarks. iRace scored very low on „Ease of Operation‟ and „ResourceRole fitment‟.as a part of the role-mapping exercise based on no. many employees were mapped into lower ranks. This created a lot of dissent among the employees.Group Analysis After analyzing the case and survey results as a group has following observations   Job descriptions were created however there was disconnect between the actual work and the job description. It changed employees‟ perception towards brand Infosys that was once known for its benchmark processes and employee friendly policies across the industry . Based on the feedback gathered. Though iRace was successful in clearly defining roles and responsibilities across hierarchies.for which it was designed. especially during the time of recession.

Exihibit 1 Year 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Exhibit 2 Project management sub stream roles – Post iRace Job Level 8 7 Job level Sub employees 1172 1705 2605 3766 5389 9831 10738 15356 25674 36750 52715 72241 91187 104850 113796 growth % 30 45 53 45 43 82 9 48 61 43 43 37 26 15 NA Revenue 27 40 68 121 203 414 545 754 1063 1592 2152 3000 4176 4663 NA Growth % 47 49 73 77 68 103 32 38 41 50 35 44 35 12 NA Net Income 7 9 13 30 61 132 164 195 270 419 555 850 1155 1281 NA Growth % 72 27 60 119 102 115 25 18 39 55 32 53 36 11 NA Role Delivery Head Senior Delivery Manager Delivery manager Business Manager Group Project Manager Project Manager Technology lead Technology Analyst Systems Engineer Role Description Delivery Head Senior Delivery Manager Delivery manager Business Manager Group Project Manager Senior Project Manager Project Manager Technology lead Technology Analyst Senior Systems Engineer Systems Engineer Systems Engineer Trainee 6 5 4 3 7A 7B 6A 6A 6A 6B 5A 4A 3A 3B 3B *This is just a indicative structure and not the actual one.` .

Exhibit 3 Project management sub stream roles – Pre iRace Role Vice Presidents(Business Units Heads) Delivery Manager Group Project Manager Senior Project Manager Project Manager Programmer Analyst Software Engineer Role Description Job Level Title Holder Delivery Head Senior Delivery Manager Group Project Manager Senior Project Manager Project Manager Programmer Analyst Software Engineer E Dx/ Dy Dx/ Dy D C B *This is just a indicative structure and not the actual one.` Exhibit 4 Old system process flow Appraisee fills the form and submits to appraiser Appraiser evaluates and sends back to appraiser Appraisee either accepts and sends to reviewer or sends back to appraiser with request for reevaluation Reviewer reviews the appraisal and sends to closure New system process flow Appraisee fills the form and submits to appraiser Appraiser evaluates and forwards to reviewer Reviewer reviews the appraisal and sends to closure Appraisee closes the form .

Exhibit 5 Survey Questionnaire 1 2 3 4 5 6 iRace has improved the clarity of job to be performed by you iRace defines the responsibility of your role clearly iRace has helped you in explaining expected role to the subordinates iRace has improved resource allocation/staffing ( resource-role fitment ) New PMS ( iRace based ) is capable of collecting performance data and evaluating it objectively iRace has helped in improving performance management process New PMS ( iRace based ) is capable of capturing activities performed by you but not mentioned in 7 job description New PMS ( iRace based ) is capable of capturing objective data to analyse the role and evaluate 8 capabilities ( role-capability fitment ) 9 New PMS is easier to operate ( Enter and Analyse data ) 10 objective of iRace inititive was explained to you before it's roll out Survey Results Total respondents 12 .

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