As K Krithivasan is set to take the helm of Tata Consultancy Services from the outgoing CEO, Rajesh Gopinathan, experts argue that the incoming CEO will need to rethink the growth strategy for the IT giant yet again.
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Sanchit Vir Gogia, CEO and Chief Analyst at Greyhound Research, said, “While Rajesh Gopinath identified the right problems that prompted the reorg by TCS last year, Gopinathan could have included horizontal reorganisation in parallel with the vertical organisation of accounts by the IT company. Gopinathan’s reorganisation strategy was likely met with resistance from account executives, customers, etc., who now had to embattle a completely different organisational structure — something which will not be welcome when they have so much at stake.”
Gogia added that TCS is however in need of an institutional overhaul; Gopinathan quite correctly identified the problem statement, especially as the IT company is posting single-digit growth numbers.
However, an institutional overhaul will need to look very different from a simple organisational reorganisation. TCS needs to make some hard decisions to achieve growth at this stage, especially on such a large scale. TCS needs to become a leaner organisation, consider paring down business units, and invest in future areas of growth.
Hindu Business Line
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