Mahindra Satyam still haunted by Raju episode?
By Kukil Bora, SiliconIndia   |   Thursday, 18 November 2010, 13:22 IST   |    3 Comments
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Mahindra Satyam still haunted by Raju episode?
Bangalore: Despite issues related to supply and logistics, high attrition and salary costs that have plagued the entire IT sector, Mahindra Satyam found its way back to profit in the first half of the current fiscal. The current quarterly results of the company indicate that the revenues have stabilized, but the question that still lingers in people's mind is, has the company overcome the obstacles or Raju's ghost is still haunting it? Since the great confession of Ramalinga Raju, a lot of changes took place in the company and after Tech Mahindra acquired Satyam, it did manage to pull it back on track. For the first and second quarter of fiscal year 2011, Mahindra Satyam reported revenues of 12.5 million ($.28 million) and 12.4 million ($.27 million). Operating profit as reported by the company stood at 1.14 million for Q1 and 0.65 million for Q2 of the fiscal year 2011. All these figures do tell a resurrection story of the brand Satyam, but can we afford to undermine the Raju episode? No. The damage that its disgraced founder has done still tops the chart of the various problems the company is facing today. During its hay day, Satyam was looked upon as one of the top Indian IT companies, but once Raju's behind-the-curtain story came to light, it spoilt the image of the company in front of its future clients. The company has already lost key clients such as State Farm Insurance, Coca-Cola, Telstra and Applied Materials despite the new management taking over. The company admits that they have gained just nine clients in the past six months. It's not only the clients that are losing their faith in the organization; it is facing lack of trust from its employees also. Headcount numbers have stabilized for the company at around 28,000 levels. However attrition continues to be at 25 percent. This could be in terms of payments, policies or generally the facilities and benefits provided. But coming back to the resurrection story, the new management board has indeed assed and executed the damage control meticulously and it is now aiming for growth. Back in the hiring market, Mahindra Satyam has announced that it will hire 9000 employees over the next 18 months. With an employee number that crosses 28,000 on rolls, the company is trying to shoot up the utilization levels in the coming quarters so that maximum number of employees are taken off the bench. The company is also taking measures to retain its employees by increasing their salaries. Because of its disgraced past, Mahindra Satyam is struggling even today, that's for sure. But the company has risen from the ashes. The evidence stems from the fact that Mahindra Satyam is back in hiring mode. It is also expecting increasing workload on account of acquiring new clients. Yes, a lot more things need to be done yet, but the revival journey has begun and the company is on its way to regain its lost glory.

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