Delaporte’s departure earlier this month, a year short of completing his full term, and the induction of Wipro veteran Srinivas Pallia into the corner office raised fears of a shakeup within the executive committee — one of the most senior decisions of Wipro – making bodies–or other high level exit. Experts, moreover, are divided about the possible effect.
Analysis by Mint shows that at least three of the “Thierry 18” came from Capgemini, similar to Delaporte.
Anis Chenchah worked with Capgemini for 15 years until he joined Wipro in April 2022 as CEO of Wipro’s Asia Pacific, Middle East and Africa (APMEA) region. Amit Choudhary, who also worked in the French IT company for 15 years, joined six months later and was given the COO baton. Finally, Ajit Mahale, who worked at Capgemini till January 2021, joined Wipro as its chief delivery officer in February 2023.
In their earlier roles at Capgemini, Chenchah, Choudhary and Mahale held positions of CEO for Capgemini Business Services, chief operating officer (COO) and executive vice president (EVP) of Capgemini’s global financial services strategic business unit, and vice president (VP). ), respectively.
Of these 18, six members are based in India, and 12 abroad. With the other 13 who were in the commission before Delaporte are also from abroad, this implies that 4/5 of the executive committee are based abroad. That’s perhaps to be expected, as Wipro gets nearly 90% of its revenue from the Americas and Europe.
That of mint queries to Wipro were unanswered till press time.
Executive search firms have different opinions about the future of not only the “Thierry 18” but also of the executive committee itself.
Some, like Ritu Sethi of ABC Consultants, expect a definitive recovery. Sethi, who is partner – technology, offshoring and outsourcing at the New Delhi-based senior executive search firm, said she expects 3-4 immediate exits, and a bigger drop over six months to a year, in an emailed response to Mint’s queries. .
“We expect that as many as 40% of the current leaders of the executive committee brought in by Thierry Delaporte may leave in the next year,” Sethi said. “The people already there on the executive committee will take some time to settle under the new leadership. and all eyes will be on Wipro.”
Others, like Korn Ferry’s Navnit Singh, don’t see any movement from Wipro’s executive committee just because Delaporte left the company.
“If Thierry hired someone, everyone was involved in that decision-making, and it wasn’t a unilateral decision,” said Singh, president and regional managing director of the executive search firm. “All members of the executive committee are there on the basis of their effectiveness and will be there on that basis.”
On Wipro’s latest CXO changes in which internal candidates are given the top job, Singh said internal candidates always have higher motivation. “In addition, internal candidates know the environment, the company culture, and loyalty to those individuals is also high,” he added.
An executive from a third-party search firm said the chances of a mass exodus of executive committee members leading to instability look bleak. “I can expect some reorganization within Wipro, but the existing members of the executive committee will not be fired,” the Delhi-based executive said on condition of anonymity. “We expect most of the 18 members who joined Wipro’s executive committee after Thierry joined as CEO to remain. It is important that they show their courage now and act without the person who bought them being in the company,” said the an executive
The executive added that Wipro would want to avoid another high-profile exit and the resulting instability by talking to them. On 25 December 2023, less than six months before Delaporte’s departure. Mint reported that at least 22 senior executives ranked senior vice president (SVP) and above left the company after Delaporte took over as CEO.
That Wipro needs to contain senior leadership attrition is a view echoed not only by executive search firms, but also by IT analysts.
“Senior leadership attrition has been high over the past two years and needs to be curbed urgently, in our view,” read a note from Abhishek Bhandari, managing director, and Krish Beriwal, equity research associate at Japanese brokerage Nomura Group.
“We believe that the two key C-level roles (CEO and CFO) have both been replaced by internal candidates to indicate confidence in the depth of senior leadership talent available at Wipro and to address the significant attrition seen over the last two years,” read. the Nomura note dated 7 April 2024.
Another Mumbai-based analyst echoed a similar view. “There is always a good correlation between stability of senior management teams and a sustainable level of growth. Companies doing well have had relatively stable senior teams,” the analyst said on condition of anonymity.
Among the big four in Indian IT, Wipro’s profitability shrank the most between June 30, 2020, when Delaporte took over as CEO, and December 31, 2023. Wipro’s operating margins fell 300 basis points from 19% to 16% in this period. By comparison, the operating margin of India’s largest IT company Tata Consultancy Services Ltd (TCS) grew 140 basis points during this time to 25%. The operating margins of cross-town rival Infosys Ltd and cross-country rival HCL Technologies Ltd shrank 220 basis points and 70 basis points in this time to 20.5% and 19.8% respectively.
Wipro is also the only company among the top four Indian IT companies to expect a full-year revenue decline, according to the company’s December quarter commentary.
Delaporte’s tenure as Wipro’s CEO was cut short after the board of directors noted his resignation on 6 April 2024. He was to serve as Wipro’s CEO until July 2025.
The 31-member executive committee, which meets every quarter to conduct a strategic review of the company’s performance, is the only one of its kind among India’s leading IT services companies. Also on the executive committee is the new CEO, Pallia, who has been with Wipro since 1992 and mostly led the American business.