Since the start of FY27, seven of India's 10 largest IT services firms have announced changes to their organizational structures, commonly referred to as the employee pyramid. According to reports from Mint, this represents a fundamental shift from the traditional pyramid structure where junior employees constitute at least two-thirds of the workforce, managers account for about a third, and leadership comprises approximately 5%. The restructuring reflects changing talent needs as firms increasingly deploy engineers with sales and consulting skills to help clients modernize existing technology faster.
Cognizant Technology Solutions Corp., Tech Mahindra Ltd, and Sonata Software Ltd are focusing on broadening the base of the pyramid by hiring at the bottom and building internal bridges. As reported by Mint, Cognizant's CEO S. Ravi Kumar stated the company is hiring at the bottom of the pyramid from outside while building bridges from inside, re-architecting their talent model into AI-augmented early career talent led by 'player coaches'. Wipro Ltd, LTM Ltd, and Coforge Ltd are taking a different approach, seeking to expand the middle tier through hiring more project consultants or reducing junior workforce to create a larger middle layer. According to management commentary, LTM's CEO Venu Lambu described their strategy as moving from a traditional pyramid to a more diamond-shaped structure.
The restructuring initiatives come amid varied financial performance across the sector. Cognizant ended the last fiscal year with $21.1 billion in revenue, up 7% year-on-year, while Tech Mahindra and Sonata Software reported revenues of $6.39 billion and $1.21 billion respectively, growing 2% and 1% year-on-year. Wipro faced challenges with a 0.3% year-on-year revenue decline to $10.48 billion, while LTM and Coforge demonstrated stronger growth at 6% and 29% to $4.76 billion and $1.87 billion respectively. TCS, the country's largest IT player, ended the last fiscal with $30.02 billion, down 0.5% year-on-year, as reported by Mint.
TCS stands out with a different approach, moving towards a skill-centric employee pyramid rather than traditional experience-based hiring. According to management commentary during its 9-July post-earnings analyst call, the Mumbai-based company is reshaping their employee structure based on skills rather than years of experience. This strategic shift reflects the company's focus on maintaining its competitive position in the evolving IT services landscape, as reported by Mint.
The restructuring strategies point to two distinct approaches according to industry analysts. As reported by Mint, Phil Fersht, CEO of Massachusetts-based IT research firm HFS Research, noted that some firms are moving towards a diamond structure by concentrating more talent in experienced engineering roles, while others are becoming more bottom-heavy by hiring AI-native graduates who can become productive faster. However, Shubham Dalia, lead IT analyst at Nirmal Bang Institutional Equities, warned that human intervention is reducing with new frontier model releases, requiring experienced hands to identify faults rather than fresh graduates. According to Sushovon Nayak, lead IT analyst at Anand Rathi Institutional Equities, the pyramid is most likely to get wider at the bottom, benefiting from an improving mix of forward-deployed engineers, while the middle may resultantly shrink in the coming years.
