Kolkata: Vodafone Idea (Vi) has reacted to a spate of exits, including at senior levels, in recent times, giving all employees an extra month’s pay as a one-time ex-gratia payout with the November 2020 salary. It has also elevated its director (marketing) Avneesh Khosla to the position of chief marketing officer (CMO), filling a position which was vacant for over two years.
The additional compensation, though, is on condition that Vi staffers remain on the company’s rolls till March 31, 2021, failing which it would get deducted from the final settlement, two people with direct knowledge told ET.
The move is seen as a clear bid by Vi to hold on to its employee base even as it readies to bolster 4G networks and plug customer losses.
The loss-making telco, which is desperately trying to arrange funding to ramp up its 4G network and clear its huge backlog of adjusted gross revenue (AGR) dues, has seen a string of top level executive exits in recent times, including ex-chief technology officer Vishant Vora, former legal head Kumar Das, chief technology security officer (CTSO) Amit Pradhan and ex-brand officer, Kavita Nair.
A top Vi executive confirmed the one-time ex-gratia payout and Khosla’s elevation, saying “people resources were the telco’s most critical assets in these demanding times when it is trying to stabilise operations, arrest customer losses and grow the 4G business”.
At press time, Vi did not reply to ET’s queries.
“It makes sense for Vi to go the extra mile to retain key managerial talent as it needs to quickly catch up with Reliance Jio and Bharti Airtel on 4G coverage, especially since the loss of key executives at this stage could impact customer services quality, leading to more potential subscriber and revenue losses,” said Rajiv Sharma, research head at SBICap Securities.
Subscriber fall remains a problem area for loss-making Vi, which lags its nearest rivals, Jio and Airtel on 4G coverage. In the September quarter, the telco lost as many as 8 million customers. Vi’s revenue market share (RMS) too fell by 22 basis points (bps) sequentially to a modest 22.6% in the July-September period, dragged by lower network-related spends, which led to more customer losses.Industry executives say the struggling telco’s recent decision to go for a rebranding exercise reaffirmed its plans to concretise its business continuity plans, but that needs to be backed with a stronger 4G network and products and services comparable with Jio and Airtel.
“For that to happen, Vi can’t afford to lose its key managers, which is why the goodwill gesture was perhaps unavoidable,” said another senior industry executive.
Vi’s leadership is confident about concluding the telco’s planned Rs 25,000 crore fundraise shortly. The telco, though, still has over Rs 50,000 crore of AGR dues payable over 10 annual instalments through March 31, 2031.
Vi recently raised prices of two postpaid family plans by about Rs 50 in some circles, with experts saying the telco is testing the waters ahead of a broader price hike, which it desperately needs to shore up finances.