Shock. Anger. Anxiety. And finally, some relief and motivation.
Employees in the grassy lawns and glassy buildings of Satyam’s software campuses saw it all in 2009 after Chairman Byrraju Ramalinga Raju dropped a corporate bombshell in his confession letter last January, when he admitted to fraud.
The campuses are now down to four from the original 13, but employees too holidays in December, relieved at last.
If it was tough for the employees to keep their cool amid a global recession on the one hand and a local loss of pride on the other, for the managers at Mahindra Satyam, it was a question of how to manage costs without hurting staff morale.
Tech Mahindra, Satyam’s new suitor to replace the Rajus, had two choices — to execute a massive reduction in workforce, or to go for a gentle, gradual approach by asking some employees to take a pay cut.
The new management decided to be minimally invasive in its headcount surgery — even if that meant losing out on a princely sum of Rs 300 crore.
Last June, two months into the management transition; the company announced a “virtual pool programme (VPP)” under which about 8,500 employees were sent home for up to six months on a reduced pay structure to cut costs. About 2,000 have been recalled already.
“Our associates will be the preferred option and only in case the skillsets and capabilities are not available in the system, will we go out and recruit,” Mahindra Satyam’s CEO C.P.Gurnani told Hindustan Times.
While the managers walked a tightrope, Satyam’s employees felt the social pressures in a Hyderabad where they were coveted, neighbours or suitors in arranged marriages.
“We had problems in real life. For example, banks would not give loans. My houseowners asked me to either vacate the house or validate my capability to continue paying the rent,” said A. Sridhar (name changed), who, like many of his colleagues, spent anxious weeks thinking about where the career was headed.
For the managers, the problem was not only the 8,500 people going into the virtual pool. The problem was the remaining 40,000 people seeing it happen.
“It hurt. It was a very difficult and complex exercise. During the period of January, February and March we told people lets fight this out together and in July we had to tell people to leave,” said ” said Hari Thalapalli, chief marketing officer and chief people officer of Mahindra Satyam. “We went door-to-door literally in every building.”
In a curious way, the global economic downturn was helpful for the fraud-hit.
“Hiring was at its lowest ebb in the industry. So,the recession helped in that sense. But the recession also hurt from a customer perspective,” said Hari.
But it provided a valuable elbow room for the Mahindras.