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India Inc faces double-edged sword

With a search on globally for successors to Ratan Tata and Narayana Murthy, consultancy firm Deloitte has cautioned India Inc against bringing in outsiders as it may send a wrong message about leadership development within the respective groups.

business Updated: Sep 13, 2010 01:48 IST

With a search on globally for successors to Ratan Tata and Narayana Murthy, consultancy firm Deloitte has cautioned India Inc against bringing in outsiders as it may send a wrong message about leadership development within the respective groups.

The $71 billion Tata Group has started the hunt for a successor to its Chairman, Ratan Tata, who would be stepping down in December, 2012. The hunt is also on to find a replacement for Infosys Chairman and Chief Mentor N.R. Narayana Murthy, who would be retiring in August next year.

A successor from within the company would increase the probability of a positive transition, as well as a successful future for the entity, Deloitte said.

"Hiring an external successor brings great risk from the cultural fitment point of view and may send a wrong message," said Abhay Gupte, senior director, Deloitte (India).

Regarding succession plans at Indian corporates, Deloitte's Gupte said that talent managers should develop an internal successor if at all possible, "because the need to look outside also sends the wrong message about an organisation's leadership development capabilities".