Flipkart’s new blueprint pushes new recruit’s joining dates by 6 months
17 IIM-Ahmedabad recruits joining date was deferred to December from June. Deferring of joining dates typically shows that the organization is not sure of their recruitment needs.
A letter from Flipkart recruitment team headed by Nitin Seth was sent to IIM-A stating that the company is restructuring their business and the new recruits would be welcomed into the new and improved work environment in December. As compensation the new recruits would be given Rs1.5 Lakhs on joining.
IIM-A Chairperson sends an email to the co-founder & CEO of Flipkart, Mr. Binny Bansal stating the unacceptability of this communication. The email stated that IIM understands how difficult it must be for Flipkart to defer joining dates of fresh recruits. Students have opted Flipkart over other options only for the name it has in the country. He also said that this move will create a negative brand impression for Flipkart and the best talent will not be willing to join them.
Students take heavy loans to study in a prestigious institute like IIM and they have to repay their loans as soon as they graduate. Pushing joining dates by 6 months and giving them bonus at the time of joining will only put fresh graduates in financial trouble.
IIM-A Chairperson says that this situation could be handled better by Flipkart by
- Written guarantee from the CEO that these 17 students will join no later than December
- A monthly compensation to be given to students till December
While move like this is common with software companies like Wipro, Tcs, Infosys. A bigger startup like flipkart doing this is the first time. IIT’s and IIM’s are expected to keep flipkart out of their campus placement if the issue continues. Already Startups attracting talent from prestigious institutes reduced big time this year.
Ecommerce Industry is going through tough time India with Devaluations and Higher cost of customer acquisitions, The trend is expected to continue for next couple of years before the startups become stable.
Flipkart founders Sachin Bansal & Binny Bansal, both ex-employees of Amazon have started this company in 2007. They followed and believed hat a model like Amazon in India will transform the e-commerce space. They created the same model and seen success over years. But in 2013 Amazon started business in India and the Chinese e-commerce giant Alibaba defeated Amazon. This made the founder obsessed about Alibaba’s lean business strategy and wanted to rework on their present business model.
Presently the company is taking hits in terms of losses caused by expenses from human resources and marketing costs. To overcome this tough scenario the founders claimed to have made a new blueprint.
Amidst all this 17 graduates from IIM-A are being affected.
UPDATE: RESPONSE FROM FLIPKART
“As we work on redesigning this programme, we have taken a decision to postpone the joining of new recruits by a few months. Instead of June 2016, the new recruits will now be part of the improved campus program in December 2016,” Flipkart has said in a blogpost.
“Flipkart will also pay an additional joining bonus of Rs 1.5 lakh to all campus recruits,” it added. IIM-Ahmedabad has written to Flipkart co-founder Binny Bansal on the issue, saying the students felt cheated for no fault of theirs for choosing the company over other brands and will suffer as they have to re-pay their education loans.