Handover - Takeover

Top Indian IT companies are popularly known as SWTICH (Satyam, Wipro, TCS, Infosys, CTS, and HCL). With Satyam debacle, now the name sounds little odd as it has changed into WITCH.

Out of the WITCH companies, Dallal Street was very happy with the performance of TCS and CTS over few quarter/yearly results. There is a mounting pressure on Infosys and Wipro to gear up else CTS is going to overtake them soon. Interestingly, over a year or so we have seen lot of changes in the management and re-organization in both these companies. When I was reading some of the articles on these changes, it reminded me of a management story.

With the changing market scenarios, stiff competition, and declining top and bottom line of the organization, the board has decided to replace the existing CEO to get a fresh perspective and thought leadership. A couple of weeks were given for handover and takeover. On the last day of the handover process, incumbent CEO handover the new CEO three sealed envelopes marked as 1, 2, 3 and asked him to open the envelopes in that order when he encounter a crisis to find a solution.

At the end of the first financial year, there is no improvement in the top or bottom line. In the panic situation CEO before the board meeting opens the first envelope. The letter inside the envelope says “Blame the Predecessor”. He goes to the board meeting and blames the predecessor for the complete mess and he is working on bringing it on track and gets away with this explanation.

About six months later, there is no change in the situation. The CEO opens the second envelope and the letter inside say “Restructure". CEO completely re-organize the business units, people and informs the board that he is getting right people in right place and aligning things that would help the organization to focus more on the customer needs.

At the end of the year, still there is no change in the situation. CEO opens the third envelope before the board meeting and the letter inside says “Prepare three envelopes".