Indian IT’s mega offices will outlive the pandemic

What happens now?
What happens now?
Image: Reuters/Vivek Prakash
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Home to almost 30,000 employees, Infosys’ headquarters on the outskirts of Bengaluru is a mini-city of sorts. Spread out across 81 acres, the distributed low-rise campus has 4.2 million square feet of built-up space across several buildings. The compound houses a helipad, grounds for cricket, football, and hockey, a 487-room hostel, a 1,350-seater auditorium, an experience theatre, seven food courts, several gyms, a large swimming pool, a bookstore, a convenience store, a laundromat, bank branches and ATMs, along with a multi-level parking lot.

Around 150 km away, in Mysuru, Infosys has another 350-acre residential campus, which is primarily used for training new hires. The facility, once seen as a testament to the company’s soaring ambition, offers snazzy rooms, a grand library, four swimming pools, and a multiplex cinema, among other amenities.

Not long ago, these campuses were abuzz round the clock with thousands of youth hustling to meet targets and service clients across the globe. But since March 2020, the Bengaluru campus lies mostly deserted. The company also sent 7,000 trainees from its Mysuru facility packing to work remotely last March.

Infosys is just one of the many companies in India’s nearly $200 billion IT industry whose sprawling offices are lying mostly vacant for over a year now. The bulk of India’s 4.47 million IT professionals shifted to work-from-home when India went into its first Covid-19 related lockdown on March 25, 2020. Even as things eased after the initial stringent lockdown, around 90% of the IT workforce in the country has continued to work remotely.

Meanwhile, given the uncertainty over when life will go back to normal, tech companies have equipped workers with computers and strong internet connections at home. Some companies are talking about permanently allowing certain roles to function remotely.

So what will happen to their huge infrastructural marvels now?

The office is here to stay

Real estate trends indicate that offices haven’t gone out of fashion forever.

IT and IT-enabled services firms are still keeping the office leasing industry afloat, comprising 60% of the demand. So campuses owned by these giants are most likely not in line to be shuttered, experts told Quartz.

Take for instance India’s largest IT services company, Tata Consultancy Services (TCS), which is aiming for no more than 25% of its workforce being on its premises at a time. Yet, the bellwether is certain about not retiring office spaces.

“(E)veryone will go to the office but not for the same length of timeframe,” V Ramakrishnan, chief financial officer of TCS, told Business Today in November last year. “The facilities will also serve as modern-day workplaces for our associates, and also house our laboratories, and research and development facilities.

Experts believe that the business models of Indian IT companies do not support a work-from-home model in the long term and they will slowly but surely need to return to the workplace.

“Most of these mega-employers are not built for work from home practices from their existing job architectures to talent practices,” Jang Bahadur Singh, senior consultant for performance and rewards at recruitment firm Aon India, told Quartz. “Moreover, factors ranging from client data sensitivity to the simple fact that not all employees can afford to work from home given the distractions around should mean that the campuses do retain their primary purposes.”

Mental fatigue has already set in for many workers. And for managers, overseeing people remotely and harbouring a positive work culture is a task. And these are important factors to consider with permanent remote work “since they will impact all things downstream to how jobs are looked at and how people are rewarded,” Singh explained.

Of course, that does not mean changes are not in order.

Revamping IT campuses

Gone are the days of open floor plans and designated seats. Experts foresee “just-in-time” seating arrangements with flexible timings and rostered office hours becoming the trend.

To adhere to social distancing norms, companies have to “de-densify cluttered office spaces,” said Shobhit Agarwal, managing director and CEO of Anarock Capital, part of real estate services company Anarock Property Consultants. “From 80 sq ft space per employee earlier, it is now being increased to 120-130 sq ft per employee.”

At self-owned campuses, this rejig has been happening for a while. Shared amenities are shut. HCL Tech announced transport services and flexible lunch hours to avoid crowding. Infosys rearranged cafeteria seating so only one person sits at one table. Wipro introduced zoning to restrict the flow of employees.

Additionally, building management is becoming increasingly automated for a more touchless experience, Agarwal said. Face masks are mandatory and constant sanitising is the norm.

Then there are acres of untapped potential. “No matter where you are working, an open outdoor space with greenery and wifi is always a few steps away,” Ashwini Deshpande, co-founder and director at Pune-based design and innovation consultancy Elephant Design, told Business Insider. Luckily for the tech giants, they have plenty of green spaces waiting to be utilised in this manner.

Post-Covid-19 office plans

While the workforce is not at full strength yet, business is in full swing for IT firms. Consequently, so is hiring.

India’s top four IT outsourcing companies—TCS, Infosys, HCL Technologies, and Wipro—together plan 91,000 campus hires for the next financial year. “Since hiring is getting strong, these campuses may be utilised for training purposes of their new employees,” said Anarock’s Agarwal. “Important client meetings can also be held here.”

For the tech industry bigwigs, utilising scores of offices in Special Economic Zones (SEZs)—duty-free enclaves that offer tax exemptions on revenue from exports—is essential from a tax-saving perspective, too.

“As it stands today, firms moving out of SEZs will forego sizeable tax benefits and perks,” said Aon’s Singh. “This would also a hit a closely-knit local economy in these SEZs in related industries which may mean a government intervention in same shape or form to protect these smaller groups.”

The work-from-home policy for SEZs still needs more clarity.