The Hindu Business Line : Wipro unfazed by exit of executives from tech biz

Bangalore, Sept. 16 Wipro Ltd is unfazed by the recent exit of its key executives from its technology business after the management restructuring in April.

Analysts, however, feel that the exits could impact the company’s prospects, as competition intensified in the global outsourcing arena amidst challenging market conditions.

Mr Sudip Nandy, who managed Wipro’s R&D and telecom business that accounted for a third of company’s global technology revenues, was the latest to put in his papers after being with the company for 25 years.

Earlier Mr P.R. Chandrashekar, Head of sales in the Americas and Europe, quit in April to join Hexaware Technologies as Chief Executive Officer.

Mr Sudip Banerjee, Head of enterprise business, who was made director on advisory board of Azim Premji Investments as part of the restructuring exercise, quit recently to join L&T Infotech as CEO.

The Wipro Chairman, Mr Azim Premji, restructured the management in April by elevating Mr Suresh Vaswani, Head of Wipro’s IT business in India and West Asia, and Mr Girish Paranjpe, Head of financial solutions practice, as joint CEOs. Sources said this restructuring led to disappointment among some senior executives, resulting in subsequent exits.

“We would like to reiterate Wipro’s ability to be an engine of leadership…We have always had leaders ready at every level to take over from where someone has left and take it to greater heights,” a spokesperson said on the leadership crisis.

Global competition

However, analysts said leadership crisis could affect Wipro’s prospects as competition from global vendors, such as IBM and Accenture, that have leveraged the Indian offshore capabilities by ramping up their presence here, intensified.

“Wipro now requires a truly global leader to compete with global vendors,” said Mr Avinash Vashistha, CEO of Tholons Inc, an advisory firm. “Other large Indian IT firm also faced such a ‘global’ leadership challenge as growth ahead for these firms would not be dictated by what work is going to come to India, but by what’s dictated by global growth,” he added.

Maintaining relations

Like other firms, Wipro has seen key leaders exiting the company at regular intervals. “Wipro has never really recovered after Vice-Chairman Mr Vivek Paul left in 2005. The company has been struggling to keep pace with growth and margins. It is not as if the company is doing badly, but there is a difference compared to when Mr Paul was there,” said an analyst with brokerage firm Motilal Oswal Ltd. “Though it’s difficult to quantify the revenue loss due to recent exits, there would be loss in relationships,” he said.

In the IT industry that operates in a global environment, relationships do help, but capabilities of vendors take precedence as they drive bulk of the revenues.

“Wipro has invested in developing leadership and its pay-back time. They are getting the return on their investments now,” said Ms Priya Chetty Rajagopal, Vice-President, Stanton Chase International.

“I would like to believe that Wipro management has sufficient depth to handle such departures, which are not uncommon,” said Mr Harish H.V., partner at Grant Thornton. “You will recollect that three people were vying for Jack Welch’s job and when one of them was made CEO of GE, the other two left within a short period,” he said.

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