Saturday, January 31, 2009

On the right track ?

Part III

Finally there is a sigh of relief among all of us with govt stepping in & taking swift measures to get Satyam back to normalcy and Jan salaries being paid off ! We lost few major clients as reported by media but managed to retain most of them. Now we can find the light at the end of tunnel as many prominent players are showing interest to takeover Satyam. They include L & T, iGate, Hindalco & Spice Group !

Even if some other company buys Satyam layoff will be inevitable. The first thing any new management focuses on will be increasing the Bottom line of their balance sheets (Operating margins) by cutting cost. And in any IT company chunk of the expenses are on its associates. Axe will definitely fall sooner or later but the good news here is that jobs of thousands of other associates will be protected.

I personally believe, initially when this crisis broke out govt acted promptly and taken few very good decisions. But things now are now very sluggish. For the past one month, the headlines of very news channel and paper is Satyam. With elections in the sight of visibility news on Satyam might be sidelined & can be found only in the middle pages! Slowly, steadily but surely they are bringing it back on track. It might take another couple of months to unfold the future of this company and 2 more quarters it should be business as usual ! We might also see a change in the name, another CEO, CFO etc.,

Wednesday, January 07, 2009

Sector Destruction Ceremony

Part II

Continuing from where I left in my earlier post....

This post deserves to be called the sequel of 'Self destruction ceremony' which focussed on how it all started and the immediate consequences. But I guess, that was just the beginning. 07.01.2009 is the date when the next part was released, roof broke down & things went upside down. This time it was more like the 'Indian IT sector destruction ceremony'.

'Satyam' has gone truly global this time. Of course for bad reasons. We kept saying that we have clients from 6 Continents and we operate in 66 Nations. I am pretty sure, the rest of the world too must have heard 'Satyam' by now! Generally movies of SRK, Aamir or Hrithik are released with huge hype & the movie becomes a blockbuster hit even before it gets released. This time its the turn of 'Satyam', starring Raju Brothers. The only difference is marketing & publicity for any theatrical movie happens before the release & here in Satyam's case it was the otherway around. Media has come together to project the 'Satyam Fiasco'. on the small screen. Trust me, I have never seen such a mass media coverage till date filled with hype & hoopla. 5 Days & still the coverage in full-fledgedly ON ! May be coz the budget of this movie is a whopping Rs. 7000 Crores !

It was an absolute shocker as things like these are quite unnatural in India. Not so shocking in the west as they have witnessed fiascos of several manfolds like Enron, World Com, Lehman etc., Many say Satyam's situation is very similar to that of Enron which has gone bankrupt in 2001. At that time Enron was the 8th biggest company in the world with over $102 Bn. But lemme tell u... Satyam's case is not as deep as Enron's was(atleast for now). Yes... Raju confessed that he inflated topline and bottom line numbers along with liquid assets. But that is not the end of all... we are in troubled waters, we are in quick sand but remember one thing we still have sizable revenues which are not fake. The issue was purely created by the top management & things hopefully be alright once some kind of takeover or strategic tie-up happens. Ofcourse, there are several other factors to be considered. Gaining new projects and more revenues seem to be quite an uphill task atleast for now. They might need to sack a portion of non-revenue generating workforce, focus more on cost cutting, bring something completely out of box etc.,

To be very frank its very exicting to be associated with this company, now more than ever. As my cousin rightly said, its a life time experience which many few people get. Every crisis has an opportunity if u are bold enough to look for it. I am lucky in one way that I am with Satyam(though at this point in time I cant proudly say) just because it makes all of us stronger. So much has happened in so less time. I am not really sure if a day will come when I can be proud of being a part of a dramatic turnaround(if any), as many things are not in my control. Satyam as a brand has gone for a toss... absolutely no doubt in it. But a Merger with some other well managed company might help clear the scars that were left by Raju's stupidity.

Next couple of weeks are going to be very crucial for us. A lot depends of the investigation, Q3 Results, cash reserves that company hold, Board Meetings, M or A. and ofcosurse Government. What I can do meanwhile is just wait and watch and may be.... be a lil proactive & start making a lil bit of preparation for my next job !