M+E Connections

Cognizant Steps Up Recruitment Efforts in Response to Competitive Talent Market

Cognizant has increased its recruitment efforts in the face of an especially competitive talent market, especially when it comes to artificial intelligence (AI), machine learning (ML), data and analytics positions, according to Brian Humphries, the company’s CEO.

“Talent is at the core of who we are and the services we offer to our clients,” he said Feb. 11 during the online Goldman Sachs Technology and Internet Conference.

Cognizant anticipated in October that it “would see a sequential increase in involuntary attrition having come through five quarters of voluntary attrition reductions” in its staff, he pointed out.

That’s partially because it implemented a “merit-based promotion and salary increase cycle” and because of a “V-shaped recovery” in the economy, he said. But “the whole industry is going through a massive demand supply imbalance” based on what he’s hearing from clients also, he said.

“I think it’ll be something that the services industry and the broader world will talk about in the coming earnings cycle and beyond in the sense that there’s a disconnect at this moment in time,” he said.

What we are witnessing is an “insanely competitive environment” in which the attrition rates are “broad-based” and include the “hot areas of the market,” which include data, analytics, AI and ML, he pointed out.

“All you can do is try to compete as best you can and try to home in on your employee value proposition and make sure you are engaged and visible,” he suggested.

To overcome the challenge, Cognizant started a campaign to recruit for talent and “will continue in the months ahead,” he disclosed. The company even “meaningfully increased our recruiting head count—the recruiters themselves – in the last few months” but “it’s a tough market out there,” he conceded.

Although Cognizant has been rewarding most of workers with merit-based salary increases, “if they get a little more elsewhere there’s not as much loyalty perhaps in a virtual world” in which communities and “team spirit” from a physical work environment are just not there now, he pointed out, adding: “This is probably as tough as an environment as the services industry has seen for years.”

More on the Aston Martin Deal

Cognizant recently announced it is the title partner of the Aston Martin Cognizant Formula One team.

Cognizant will also partner with Aston Martin to “evolve its facilities into smart factories, leveraging 5G” and the Internet of Things (IoT), Humphries said during the company’s recent earnings call.

“Automotive is one of our priority industries” right now, he said Feb. 11. Although Cognizant is the title sponsor of the Aston Martin Formula One team, he said he does not really see it as a sponsorship.

“I actually think about it much more holistically as a relationship” and how Cognizant can leverage AI and other technologies, he said.

Restructuring Status

Cognizant set up a transformation office in 2019 that he said at the time had been “charged with reviewing six areas of focus” for the company.

There was a restructuring element in it, but “it was also about enabling Cognizant to go from being a $17 billion company to a $30 billion annual revenue type company, and making sure we had digitised our processes internally to allow us to scale,” he said Feb. 11.

“We’ve executed well against it,” he said, explaining: “I think we’ve done a good job all things considered, particularly against a backdrop of COVID and a ransomware attack” against it last year.

“I feel extremely confident about our client portfolio,” he said, noting he also felt “confident about the enhanced rigour we have in our deal review.” New executive additions have helped, he told viewers.

“I call it a multi-year project to reposition the company,” he said, adding:
“The core of the company is extremely healthy. It’s just we are shifting some focus into certain areas.”

The company is still “in the middle of a transformation” but “the good news is, even though we’re in the middle of things, some of the heavier lifting of the transformation is already behind us,” he said.

“We have to execute against our strategy [and] that involves repositioning the brand” and “globalising the company, which is a huge opportunity for us,” he said, noting 75% of its revenue still comes from the U.S.

As part of its strategy, digital investments will continue, along with digitising the company, he said. The company is also doing some work to make sure its IT and security systems are “more robust,” he said, adding Cognizant has “spent a lot of money on that in the last year.”

Cognizant is also now “one of the largest digital engineering companies in the world and you will see us continue to build out those capabilities,” he told viewers.

Overall, when it comes to the transformation, “we’re on track; we’re doing well but there’s more work to be done,” he conceded.