The Value Factor
IT companies in India havent been around for too long ... So, I dont really know of too many people who have spent more than 15 years at IT companies.
Most folks that join IT companies in India have two options after a few years of working - They get moved into Management or they have to change jobs.
This is an interesting phenomenon and I decided that its worthy of its own defined ratio.
Value Ratio = (Value Contribution of Employee)/(Cost)
When the employee joins as a fresher, their value ratio might be 2 or so. Their ratio grows very fast in the first few years, because their value increases much faster than their salary. However, after a point, the incremental value added increases very slowly.
This is because, in the IT Industry, only the last few years of experience really count - A person with three years experience is pretty much equivalent to a person with ten years experience, because the first seven years worth of experience of the latter is likely to be irrelevant, due to the rapid change in technology.
So, for the employee to continue to grow their value ratio and simultaneously get salary hikes after about 3 years, they have to move into management.
IT is one industry where experience isnt that important - In fact, it might be a liability - If you are a pure programmer (no management experience) with ten years experience, nobody will want to hire you because they can get a guy with 3yrs experience who is as technically sound as you and much cheaper ....
Most folks that join IT companies in India have two options after a few years of working - They get moved into Management or they have to change jobs.
This is an interesting phenomenon and I decided that its worthy of its own defined ratio.
Value Ratio = (Value Contribution of Employee)/(Cost)
When the employee joins as a fresher, their value ratio might be 2 or so. Their ratio grows very fast in the first few years, because their value increases much faster than their salary. However, after a point, the incremental value added increases very slowly.
This is because, in the IT Industry, only the last few years of experience really count - A person with three years experience is pretty much equivalent to a person with ten years experience, because the first seven years worth of experience of the latter is likely to be irrelevant, due to the rapid change in technology.
So, for the employee to continue to grow their value ratio and simultaneously get salary hikes after about 3 years, they have to move into management.
IT is one industry where experience isnt that important - In fact, it might be a liability - If you are a pure programmer (no management experience) with ten years experience, nobody will want to hire you because they can get a guy with 3yrs experience who is as technically sound as you and much cheaper ....
Comments
A good article on TCS' website is at http://www.tcs.com/0_media_room/reports/200111nov/20011105_patriarch.htm.
Also, you should read a very nice, albeit older report titled "India's Software Industry" published in the Jan/Feb 2001 issue of IEEE Software Magazine.
I don't really agree with your appraisal of the experience factor in an IT occupation. IT, like any other field, needs good and rounded experienced professionals. As you work on more and more projects, you not only become more competent in your technical area of expertise, but also in peripheral skills like team coordination and project management. In fact, most IT personnel in a software company stop writing development code after about 2-3 years.
At the same time, you cannot classify them as managers. In fact, too many managers in any IT company are a recipe for disaster. IBM, for example, is one company that has too many managers. There are managers managing groups of 5-6 people. Needless to say, this isn't working for IBM. I am sure you can find enough information regarding this on the Internet.
My point is that value in an IT company comes from successfully completed projects rather than plain experience. In the end, no one wants to hire a person with 10 years of experience but 2 notable projects under his belt.
-es