Drawing up a succession plan is the flavour of the season for corporate India. Close on the heels the Tatas and Infosys announcing plans of leadership change, L&T chief A M Naik on Friday said his successor will be named by March, 2012, a full six months before he hangs up his boots.
"The process is on, and you will have a name by March, 2012, six months before I retire. McKinsey and Bains are working on the process," Naik told newsmen on the sidelines of the company's 65th AGM in Mumbai on Friday.
While Bains is looking at its product businesses, McKinsey is looking at its project businesses. With a change at the helm of affairs at L&T, India Inc will be without the guidance of three of its visionaries as Ratan Tata, Narayana Murthy and Anil M Nair would retire in a couple of years. The country's largest engineering and construction conglomerate earlier this year had announced that Naik would retire by September, 2012.
A number of L&T's top management personnel, including Chief Financial Officer Y M Deosthalee, will also leave the company next year. Naik, who joined the company way back in 1965 as a junior engineer and steadily rose through the ranks to become its Chairman and Managing Director in December, 2003, said the $10 billion conglomerate has already appointed McKinsey and Bains to conduct a leadership programme.
The son of a school teacher from Gujarat's Endhal village, Naik is credited with turning around a loss-making L&T into a Rs 47,000 crore conglomerate in a few years time, which is into over 60 businesses handled by over 20 subsidiaries. Naik joined the company at a monthly salary of Rs 670, but now takes home an annual package of over Rs 12 crore.
At the AGM, many shareholders pleaded with Naik to continue as the chairman emeritus, to which he just said the company will be in safe and strong hands after his retirement. L&T joins the Tata Group, which will see a leadership change in a few years' time.
The country's largest corporate group on August 4 had instituted a five-member panel to identify a successor for Group Chairman Ratan Tata, who retires in December, 2012. Infosys chief mentor and chairman N R Narayana Murthy had recently said the company co-founded by him will get his suitable successor well in time before his retirement in August 2011.
The hunt for a replacement for Infosys chairman and chief mentor has already started as Murthy will retire in August 2011 when he turns 65.