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Monday, Jan 12, 2009
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Software Info-Tech - Interview
My message to the employees is that they should continue with the great work. We have a new board now. We will ensure that the company continues with operations. 
Mr Kiran Karnik Moumita Bakshi Chatterjee New Delhi, Jan. 11 Moving with urgency to steer Satyam Computer Services out of the current financial mess, the Government has appointed three marquee names on the board of the company – including former Nasscom President Mr Kiran Karnik. The IT industry stalwart, who was at the helm of the software body when the industry survived the outsourcing backlash, now faces the complex task of managing crisis of a different kind. Mr Karnik spoke to Business Line on his immediate priorities for Satyam at this critical juncture, assuaging employee fears and the way forward. Excerpts: How do you view the Government’s prompt move to nominate the three board members, and what is the agenda now set out for the board meeting, which is scheduled in the next 24 hours? I am happy that the Government has moved quickly and decisively. The agenda ahead will be decided when the board meeting happens. But broadly, the priority is now to ensure the company’s stability and business continuity. It is also important to ensure confidence of employees and customers. Satyam has done well in the past, and the employee talent is high. So, basically, our immediate focus will be to ensure stability and continuity while minimising and reducing disruptions. In addition, we have to see and set the agenda in terms of the company’s balance sheet, cash position and results. Therefore, high on the priority is to see where we stand, the financial position, salaries, etc. Who would be the chairman of the new board? What role will the three nominees - appointed today – play in selection of other board representatives? We will have to see that … The Government has not said anything at this point. My understanding is that the Government will appoint the others, but we can make suggestions informally on what kind of people need to come on board. What happens to the top management of Satyam as the Rs 7,000-crore fraud has also put the spotlight on top business and vertical heads of the company? These are things we have to discuss at the board level when we meet, with regard to how the company was operationally managed. But you are right, there will be a dilemma in looking at people… whether they were involved with what happened. We will have to review the extent of the involvement of people… the board will do that. Employees of Satyam are living in uncertainty with many fearing job losses ahead. As a board member, how will you assuage employees’ apprehensions? My message to them is that they should continue with the great work. We have a new board now. We will ensure that the company continues with operations. Finance apart, the company’s business record and delivery of output has been great. That would not have been so if it did not have a great team of employees. The employees know that. So, my message to them is look, someone, somewhere made a mess, but you, the employees, at least 99 per cent of you or more, were not responsible for that. Are you ruling out pink slips for employees? We will have to review where things are, but effort definitely will be to ensure that there is no problem for employees. But again, it will have to be discussed at the board level. Given that the company is facing acute financial trouble and needs to source financing, Mr Deepak Parekh’s leadership will be critical. Your views? Definitely, his expertise in the area of finance is key. In fact, both Mr Parekh and Mr Achuthan bring their own areas of strengths. Given that in future there may be a need to arrange financing, their backgrounds and expertise will be important. The Satyam scam has botched the image of the $50-billion Indian IT industry. Do you see long-term repercussions of this on India’s position as an outsourcing destination? It is important to see this as an aberration and once in a lifetime incident. It is not as if the IT sector generally has a problem. The Government’s swift action will certainly instil confidence. It is definitely not a long-term issue. Of course, there are short-term concerns. The companies that I have been talking to have great confidence in India. How are IT industry’s outsourcing clients responding to the fiasco? I did not have much interaction but it is certainly an issue of concern. They want to know what is going to happen. And that is a rightful question. However, it is fair to say that there is no great panic among clients. And, again, I would like to point out that concerns have been addressed by the Government through speedy action. So we are not seeing a major impact. Also, it is important to note that Satyam has bagged some new contracts, and we want to reinforce that sentiment. We will have to see how things are to be handled, going forward. When companies go bust, employees suffer the most To quit or not to quit – Satyam employees risk lower salary elsewhere Satyam staff in dilemma as cash crunch fears rise Job switch not easy right now, say worried staff 20,000 resumes posted on job portals ‘Spirit of Satyam’ lives on More Stories on : Software | Interview | Corporate Governance | Economic Offences | Satyam Computer Services Ltd
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