Mahindra Satyam Needs 2 More Years to Become Fully Functional BPO in India

Satyam Computer, which was taken over by the Mahindras a year ago and renamed Mahindra Satyam, is still facing major operational challenges, says CEO CP Gurnani. He pointed out that it will take the company two more years to rejoin the race with TCS, Infosys and Cognizant, and reach the desired level of efficiency.

“At the time of acquisition, we had presented a three-year transformation plan. The company still needs another two years to level out on some scorecards. It has been structurally reorganised to reduce the management layers between the CEO and a trainee engineer from 14 to seven. These changes have happened for transparency, collaboration among teams and for better customer centricity,” he said.
Mahindra Group VC Anand Mahindra and Tech Mahindra CEO Vineet Nayyar—along with corporate affairs minister Salman Khurshid—flew down to Hyderabad on Monday to mark the first anniversary of Satyam’s takeover by the Mahindras. The toughest challenge facing Mahindra Satyam is of course attrition, very much like that in other IT companies. It also has to grapple with bothersome issues like client concerns and account restatements.

Analysts say while the industry average attrition is 13-14 %, the company’s attrition rate could be higher at 30%. While there has been some client issues, the firm says it has been able to retain almost all customers post takeover. Mahindra Satyam is, however, hopeful of meeting the financial restatement deadline, slated for June end. “There are other aspects related to the recovery of Mahindra Satyam that we have to tackle with either our law or that of another country. Whatever could be creatively and constructively done, and in collaboration with whichever wing of the government, has been done. We are trying to ensure that things can move fast,” said Salman Khurshid.

On the other hand, Anand Mahindra is more bullish about the company’s prospects. “I don’t see any reason why we should not aim for the top… While we were working on recovering ground, people were building their companies. But we also have a secret weapon that is the mission orientation of people at Mahindra Satyam,” he said.

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