Redundancy

What Internal factors have contributed for our predicament?


I am breaking my head, where did we go wrong. What wrong decisions did we take. One major issue I overlooked was - Retaining Cash. As with most of the start-ups, I guess I expanded rapidly without balancing receivables. In the event of market down turn, what determines one's survival is how much cash you have on hand. During good market, as everybody I believed in continuity of business.


Most important issue which Indian IT industry is facing today is to reduce redundancy. Redundancy concept is operational need in a good market. But in a bad market it is the major contributor for down fall. This is why today every company is reducing head count, realigning project resources.


Today I received a call from one of the leading IT company HR. This person wanted my suggestion whether to go ahead with annual reviews or not. Should they do selective reviews. And how does that effect the rest of the team. This person wanted to know how everybody else is doing. A typical HR challenge.


Like everybody, we had excess staff (per head revenues was less), excess infra (higher over head costs), more focus on existing clients (no client base expansion). These are very real operational issues. As well as management experience issues.


Couple these things with market down turn and huge payable (business loss and capital costs) we are doomed.


Question is how to attain balance in this bad market?