Wipro, India’s third-largest software services firm, announced in April the appointment of Girish Paranjpe and Suresh Vaswani as the company’s co-CEOs. At the 2008 Wipro Mandala event (an annual meeting that brings together Wipro employees and clients), held in Miami last month, India Knowledge at Wharton and Ravi Aron, senior fellow at Wharton’s Mack Center for Emerging Technologies, spoke with Paranjpe and Vaswani about the company’s reorganization and their roles. An edited transcript of the conversation follows:
India Knowledge at Wharton: I wonder if we could ask you some questions about leadership at Wipro and the reorganization. What do you think are the pros and cons of having a situation in which there are two core CEOs rather than a single CEO, as you had in the past at Wipro?
Paranjpe: When we look at both the opportunities and the challenges that we face — on the one hand, we think that we can continue to grow at this pace for another couple of years, which means adding a huge number of people, adding a huge number of clients, and changing the type of services that we provide to them. So, there’s a huge scaling-up challenge and an opportunity.
We have to also change and make our business more complex and more rewarding to us and our clients. So, there are two challenges and two opportunities.
Given the enormity of the opportunities and the tasks at hand, we just felt it was worthwhile to have two of us trying to drive this rather than leave it to one individual to try and [everything].
And from a very personal perspective, it can get very lonely at the top. So, having two people helps.
India Knowledge at Wharton: Suresh, what do you think?
Vaswani: I would just completely endorse what Girish said — that, really, given the size of our business and the ambitions that we have for [it], two is certainly better than one. So, we’ve spoken about the power of two, and we do believe that the power of two will help us so far as we are concerned, given our environment.
We have two things. One is that two brains are better than one when it comes to long-term strategic thinking, and I think that will be great. And we are used to working with each other. And second is, you just need that much more bandwidth. I mean, given the sort of growth we want to drive — 35% growth here in India, the ambitions that we have for our business in terms of being one of the top 10 IT service providers — you also need good, strong bandwidth available.
I think the power of two — given the fact that we have strong experience working with each other and given the fact that we are from a Wipro culture, which has a lot to do with teaming — can be extremely powerful.
India Knowledge at Wharton: You both spoke about working well together. In the years that you have worked together, have there been times when the two of you have disagreed? And if so, how did you resolve those disagreements?
Paranjpe: We have worked together for many years and there have been times when we have disagreed. But, those have been mostly professional disagreements rather than any personal animosity. And that, I think, can happen among any two professionals. So, I don’t think that’s a sign of any weakness or any sign of worry. In fact, if you have good professional respect for each other, it’s a good way to think forward.
And we don’t want both of us thinking exactly alike, because then there’s no advantage [to working together].
Vaswani: I completely agree with what Girish is saying — and maybe we’re agreeing too much, but I think that’s the plus, actually. I may have a different viewpoint and Girish may have a different viewpoint, [but] we do realize that we’re driven by the same goal, which is the goal of Wipro. So, the best decision emerges.
The best decision emerges when there are some counter views, when there’s some amount of debate. Then, the right call gets taken. And what I’ve seen over the last three or four weeks that we’ve worked together, it’s not that we’re on the same page on everything, but finally the decision we have taken is the right decision. So, I think that is clearly, clearly bearing out.
Aron: In our interview with Mr. Premji, he commented that the two of you and he will form a sort of consultative committee that meets once a month for an hour or so. This structure of having collective leadership seems to be much more prevalent in Indian IT companies … much more so than in Indian manufacturing or financial services companies.
There was Cognizant, with a North American CEO and an Indian CEO in charge of delivery. Then there’s Infosys, which has three or four people actively managing at the top. And now, there’s Wipro. So, what is it? Is it IT companies? Is it India? Or an intersection of both? What do you think, Suresh?
Vaswani: I would say it’s the intersection of both. But, I would still give more emphasis on the IT companies simply because we’ve grown from almost being nowhere in so far as the map of the world is concerned in the context of IT to being very, very significant players, right? So, we’ve reached here and that’s great. But, the journey over the next three or four or five years, all of us — all the 301 IT companies — have aspirations to be in the top 10. And, therefore, you’re not really competing with each other, but you’re really competing with the global players.
So, there’s a lot of transformation that we will drive. The industry by itself is transforming, so what Cisco is today is not necessarily what Cisco is going to be tomorrow, just to give you an example.
Given this sort of opportunity going forward, given the sort of challenges going forward, given the sort of growth aspirations that we have, all Indian tier-one industries are talking about between 25% to 40% growth, depending on what sectors you are focusing on, depending on your ambition levels.
I think that on that sort of scale — 100,000 people going up to 200,000 people — the collective management is absolutely key for success. So, whether it is two, whether it is three, I think there is something in that, in terms of having a brother management team, which has more bandwidth, which takes decisions in collaboration and which is really taking large complex decisions.
Paranjpe: In many ways, the comparison that you make between the IT industry and other industries shows one big difference: That the IT industry is more like a partnership at the end, because it is part of professional services, and professional services firms can be run collegially. We cannot be run on a command and control basis, which is why it requires more collective leadership, both at the top as well as at every level of the organization.
What has happened is a natural evolution about how such firms get managed. And I think the fact that we have had longevity [in terms] of people [staying] makes it easier for people to work together rather than having to worry whether we really need a star CEO.
Vaswani: Whether there is one leader or two leaders at the top, the business invariably needs a lot of collaboration. You have heard of the vertical structure; you’ve heard of the service line structure. And all of that is not going to work if teams don’t work collaboratively. Right?
Two people, three people at the leadership level have to really work together. So, I’m beginning to see one more angle: The big advantage of this structure is that people see [collaboration] working right at the top.
So, if Girish and I are working collaboratively, it fosters a spirit of collaboration right across the organization — and that would be required even if there was one leader at the top. Now, I think, it will foster much more of that collaboration.
Aron: Very interesting. Is it the nature of the services industry– for instance, consulting firms, legal firms — that they are often run as partnerships rather than with the command and control of a CEO?
And also, the fact that you both grew with the industry as the industry grew — so in your professional tenure at Wipro, you’ve seen it grow from a fairly small company to one of the most significant players in the industry. Is it that which makes it much easier for you to work together?
Paranjpe: I think there are two reasons. Because it’s a professional services firm, and because it’s a collegial atmosphere and because it works more like a partnership, it makes sense for us to have some kind of collective leadership at the top rather than the command and control system. Right? So, that’s number one.
Number two, what makes it easier and more acceptable is because we’ve known each other for a long time. We know the work style, we know the strengths and weaknesses, we know where the complementarily exists, so it is easier for us to accept that that is the way we will make it work.
India Knowledge at Wharton: Recently, some senior Wipro executives left to take high positions at [other] companies. There was some speculation in the media whether this was related to the reorganization. Is that the case, or what do you think?
Vaswani: No, it was not related to the reorganization at all. Some of the people moving out probably happened much before we were announced as the joint CEOs. So, the decisions that were taken, were taken before. It had nothing to do with the restructuring.
India Knowledge at Wharton: Looking beyond the restructuring into where you see opportunities, could you tell us a little bit about where would you want to drive Wipro? There was some discussion about making it one of the top five players in the IT space. What would be your vision of how to go about it?
Paranjpe: If you look at it historically, seven or eight years ago, [we were] dwarfed by our global competitors. … If you look at the journey from then to now, I think we have largely overcome the scale issue. … If you look at the number of employees, look at our client base, our significance in the marketplace, I think we are fairly comfortable that in terms of pure scale and size, we are in the reckoning set. I’m not saying we have to stop worrying, but I don’t think that’s a major issue for us anymore.
So, the next issue, having overcome the scale issue, is really a sophistication issue. Where are the client relationships, where are the boardroom relationships, where is the sophistication of work that we do with clients? Where is the sophistication of contracting that we do with them? What’s the level of ownership that we [have] of the work that we do for them?
So, that’s the next hurdle that I would say that we have to cross. And that is both a hurdle and an opportunity, and it requires work at multiple levels. It requires work at building deeper client relationships and basically extending our client base. I think, extending the client base is not about adding 100 more clients, it’s about [extending] within the same top clients. How do you go beyond the CIO? How do we get to know the CFO, the line of business heads, the CEO, the chief operating officer, so that we become much more comfortable as a provider to do business with, rather than being solely supported by one of the CXOs?
So, extending our relationship base within the client is one of the top things that we have to do. Linked to that is how do we extend our ability to provide, not only more services, but how do we integrate that and take it to the next level of sophistication. So, building our own competency and ability to integrate services and take it to the next level is the second thing that we have to do.
And linked to that is how do we enrich our talent pool? Today, when all is said and done, our talent is largely technology oriented, largely execution driven. How do you go from being largely technology oriented and execution driven to being more business driven and much more consultative?
So, those are the three big challenges that we need to overcome to be able to go to the next level where we can say we have done it all.
India Knowledge at Wharton: Anything you want to add to that, Suresh?
Vaswani: A few things. Clearly, we want to drive towards being in the top 10 first. And we are there in the top 10 on various parameters. What we want to do is to make sure that from every perspective, we are in the top ten. So that’s one of the big priorities that we have. A lot of what Girish said is towards driving them.
Second is, we’ve given that cost transformation to customers. We want to do a lot more transformation in addition to costs, delivery transformation, business model transformation and so on and so forth.
So, our thrust is not only being a strong IT service or IT solution company, but move from that to being a company that is able to drive transformation insofar as customers are concerned. I’m talking about business transformation. That, I think, is a key driver for us to really hold our place in the top 10 IT services companies in the world.
There are certain, very unique differentiators that we have. For example, infrastructure services are a big differentiator for us. Business process outsourcing is a big differentiator for us, and we are strong in application. Right? How we get all of these three coherently in front of the customer and give that big transformational benefit to customers is a challenge, or is an opportunity and a challenge that we have, and we need to really capitalize on that.
There are certain segments — for example, if you look at Wipro, we are a very, very dominant player in our own domestic market, which really means we’re competing only with the global players there, because none of the domestic, most of the Indian global players don’t have a significant presence.
That’s another big opportunity that we have, in terms of being absolutely the lead player there, and actually driving a lot of innovation there. Because a lot of innovation is happening in India. And that innovation is applicable globally as well.
And, given the fact that we have a very, very major presence in some of the emerging markets, we do see cost structures emerging there, which are truly transformational. We see delivery structures emerging there, which are truly transformational, which can also have applicability to the global market. So, I think, there’s a lot that we have going for us. We have a unique set of assets, unique width of services; we have been early insofar as investing in domain capability is concerned.
Now, we are driving a lot more on the consulting side. The idea is really to get all this together much more strongly in front of customers, which would also mean some transformation in our field force. We should project ourselves more strongly than perhaps we have been. All these steps will enable us to realize our vision of being in the top 10.
Aron: You mentioned about becoming a strategic partner to your clients. It’s not just that you are going to give a cost transformation, which you’ve already done, but you also want to do business transformation. So, the short question is: do your clients see you as somebody that can drive organizational change and business transformation today?
Vaswani: Customers are asking that capability from us. So, it is not that we don’t have credibility, having delivered all that that we have done to customers. Customers today expect us to do it right, want us to do it. And that’s the good news. We don’t have to go back, we don’t have to go and establish credibility with customers. Most customers, given that we have delivered a range of services to them, and delivered them successfully, they have seen our transformational capability; I think they are telling us that ‘Look, you must do this. You must be in the area of consulting. You must give us more business transformational value.’
So, we don’t have a problem in the context of credibility. I think what we need to do is to build a lot more of that capability and deliver it to our customers.
Paranjpe: I’ll second what Suresh said. If you look at it historically, for example, global competitors came from a different world. They were accountants. They were auditors. And then they, over time, transformed into management consultants. So, as long as you have a track record of having delivered what you promised, clients are willing to give you a shot at applying something new.
And as long as you do that in collaboration with them, and you do invest ahead of time and take a measured step, you will get there.
Aron: Are you able to recruit the kind of talent that you [need]? I don’t mean the lateral senior people that you are bringing in from peer companies such as Cap Gemini or Deloitte, but at the campus level, are you able to recruit from the broad campuses of the U.S. or of India? Are you able to recruit the kind of students that want to go into consulting as a career? Are you able to attract them to Wipro?
Can you go to the IIMs and the ISVs and the Whartons, the Stanfords, and say, ‘We are a consulting career choice?’
Paranjpe: That’s a journey that we have just started on. It’s too early for me to say, yes we can do that, because we have not tried it really with sufficient investment and sufficient zest, I would say.
But, I think what is clear to almost all the people that I encounter, whether it is clients, whether it is employees, or potential employees, is that most see writing on the wall. They know that in the world we are part of the future.
And if they want to build a long-term career in professional services, we are definitely in the reckoning list. So, it could be short sighted for them not to give us a shot.
Vaswani: I would support that. The fact of the matter is that we are able to attract, on lateral basis, some of the best people from the industry. There is no logical reason as to why we cannot go back to the campus where these people came from and [attract people from there].
If you are referring to Indian management schools, we do hire from some of the best schools. Some of us are also from the best schools. There is a lot of IIM Ahemedabad, IIM Bangalore and IIM Calcutta even within the top management of Wipro, and that by itself is a pull to some of the people that we want to hire.
Globally, I think, we need to do a bit more in terms of establishing a brand on campuses, in the context of consulting. Because globally, I’m talking about U.S. campuses, perhaps people see us still as strong IT services providers with a global delivery or offshore delivery model from India. And I think we’ve gone well past that. I think we need to do a lot more branding activity in terms of some of the global campuses. And I am sure people will see the logic, see the reason of coming and working with us.