In revenue growth and operating margin, Wipro continues to lag its peers, like under Delaporte’s immediate predecessors – which is what allowed even HCLTech to cross Wipro in revenue in 2018, two years before Delaporte took over. In 2021-22, the year after Covid struck and Delaporte’s first full year, Wipro’s revenue surged by almost 27%, way higher than its peers, partly on account of a huge acquisition (of Capco), but also because of a stronger deal flow. But after that, Delaporte could not sustain the momentum, and revenue growth slipped below that of peers.The company’s operating margin too has dropped significantly in the past couple of years, like that of its peers, with IT services demand globally falling. Only TCS has managed to keep the margin reasonably stable.
So, what would have precipitated Delaporte’s premature departure? There are plenty of senior executives – many of whom quit during Delaporte’s tenure – who have not been happy with his restructuring efforts. Few would have questioned the need for a restructuring, given Wipro’s performance before Delaporte stepped in. And, from all accounts, the steps Delaporte took in trying to simplify the structure – drastically reducing P&L (profit & loss) units reporting to him, breaking down walls between units, sharply cutting the number of KPIs (key performance indicators) used to assess executives and employees – had chairman Rishad Premji’s buy-in.
But in its implementation, there looks to have been plenty of problems. Phil Fersht, CEO of IT analyst firm HfS Research, says in a blogpost: “Delaporte rarely left his Paris base, while his CEO counterparts have been regularly rallying the troops across India and the US. You can’t run an Indian-heritage business during tough economic times when you’re not physically present to boost morale and represent the firm.”
Many top executives, including at the SVP and VP levels, quit. The prominent ones include Jatin Dalal, the CFO, Rajan Kohli, who was president of Wipro’s integrated digital, engineering and application services business line, Angan Guha, who oversaw a portfolio spanning financial services, manufacturing, energy & utilities, hi-tech and Canada operations, Sanjeev Singh, who was COO at Wipro, Mohd Haque, SVP and head of healthcare and medical devices for the Americas, and Ashish Saxena, SVP and head of the manufacturing and hi-tech business unit.Delaporte also brought in many executives from outside of Wipro. Fersht says in the process, Delaporte neglected the loyal Wipro-ites.
And many of those he brought in to head regions did not stay long. These included Tomoaki Takeuchi, country head for Japan, Sarah Adam-Gedge, MD of Australia and New Zealand, Douglas Silva, country head for Brazil, and Mohammed Areff, country head of the Middle East region. Maybe they could not fit into the culture of an Indian company. Stephanie Trautman, who was brought in from Accenture as chief growth officer in 2021, resigned in January. This, and the integration of the strategic pursuits team into strategic market units, distracted Wipro’s large deals team.
Ramkumar Ramamoorthy, partner at Catalincs and former chairman and MD of Cognizant India, says CEOs of large companies need to be rainmakers and pied pipers.
