Forbes India Leadership Award: Best CEO-Private Sector
The year 2009 opened with a shocker for India Inc as B Ramalinga Raju, the founder of Satyam Computer Services, confessed that he had been inflating his company’s accounts by over $1 billion. As Raju, the posterboy of India’s IT revolution, was arrested and the board disbanded by the government, it seemed Satyam had reached the end of the road. So, when Anand Mahindra acquired it in April that year, even he knew it would take much more than just a change of leadership for Satyam to regain its earlier glory. That’s when Mahindra turned to CP Gurnani, who was then heading international operations at Tech Mahindra, an IT firm owned by the Mahindra Group.
Thirty-four years ago, a young Gurnani, fresh out of college with a degree in chemical engineering from National Institute of Technology, Rourkela, could not have predicted where his life would take him. In those days, information technology was not common in the Indian business lexicon. The technology sector then was all about hardware, electronics and computers, which didn’t interest Gurnani.
After graduation, he considered many entrepreneurial ideas, some of which included starting a micro-nutrient business and setting up a mini cement plant. “The only hesitation at that point was capital. I knew that my father would have bet every bit of money he had on me. But I would have gone ahead if it was my money I was betting on,” says Gurnani. He dumped his ideas and bagged a job as a graduate chemical engineer trainee at JK Synthetics (now JayKay Enterprises). It was only in 1986 that he switched to computers and joined the then HCL Ltd, which was largely into hardware development.
“At that time, computers was a sunrise industry and I took a conscious decision to work in such a sector,” says Gurnani. At HCL, he rose from the position of an area manager to the country sales manager and eventually became senior vice-president (corporate). He was also responsible for the joint ventures that HCL did with companies like Perot Systems, Deluxe Corporation and General Instruments, among others.
In 1996, technology entrepreneur Shiv Nadar’s HCL Technologies (a spin-off from HCL Ltd) floated a joint venture (JV) with the US-based Perot Systems to tap into the growing software outsourcing market. Nadar had entrusted Gurnani with the task of finalising the JV. “I was negotiating a legal contract without a lawyer sitting next to me. I called up Shiv and said, ‘I think I need to have a legal firm.’ He said, ‘What will they tell you that you don’t already know?’ ” he recalls. Nadar’s response, says Gurnani, “taught me that if you are 70 percent ready for the job and have the right attitude then you can accomplish just about anything.”
Initially, the HCL Perot JV was not making money, but with some deft negotiations, Gurnani ensured that the company was not making losses either. For instance, he was instrumental in bagging an outsourcing deal worth $50 million from UBS, a global financial services company. It was quite a feat given that, at the time, HCL Perot had a net worth of $50 million.
By the turn of the millennium, however, the two JV partners were locked in a heated boardroom battle. At the time, Gurnani was the chief operating officer of HCL Perot Systems and Vineet Nayyar the CEO. A November 20, 2002, report in The Economic Times noted that Perot Systems was seeking the removal of both.
The mudslinging between the two feuding partners, with Gurnani caught in the middle, unsettled him. Recalling that turbulent period, he says, “It was not funny being covered in newspapers with Perot Systems alleging that HCL was stealing intellectual property rights.”
Eventually, in 2003, Perot Systems bought out HCL Technologies’ stake in the JV for around Rs 480 crore. It was seen as an amicable settlement.
Looking back, Parthasarathy says, “He did go through a lot and became a victim of the case. It was a fairly traumatic time for CP. There were lots of dynamics at play, but through all that he was focussed on the business. CP realised that the company had a set of customers who could not be let down as a result of what was going on.” She remembers how Gurnani was open in his discussions with colleagues on the goings-on. “We never felt that we were out of the loop or that he was hiding things from us,” she says.
Parthasarathy feels the evolution of Gurnani as a manager happened between the time he started working at HCL Perot and when he moved out. Gurnani agrees: “The learnings there were some of the best in my life.” He fell back on those experiences when he was tasked with turning around Mahindra Satyam.
Eleven years ago, when Gurnani joined MBT, the company had 5,000 people and clocked revenues of about $100 million. Today, Tech Mahindra has a workforce of 1.3 lakh people and is among the top 30 listed Indian companies by way of market capitalisation.
That said, the Indian IT industry is going through a phase of transformation. The outsourcing model is changing with companies adopting and acquiring newer technologies. “It is not a time to be rigid and be wedded to past strategies,” says Mahindra. “CP has the perfect outlook in that he is setting in motion some critical experiments within the company.”
Some of these experiments include a startup incubation programme to support and encourage entrepreneurial spirit among employees. In addition, Gurnani has launched a host of special leadership programmes such as ‘Young CEOs’, ‘1000 leaders’, the ‘Global Leadership Cadre’, and ‘Achiever in the Making’, to ensure that Tech Mahindra has a pipeline of future leaders.
Dinesh Goel, partner and India head at international advisory firm ISG, believes that Tech Mahindra’s successes have a great deal to do with Gurnani’s leadership. “Steering the company on a high-growth trajectory and rallying people behind requires an energetic and charismatic leadership.”
In the last two years, Tech Mahindra has reported an average annual revenue growth of 18.3 percent, outpacing the IT industry’s rate of 12-14 percent. But Gurnani chooses to shun all limelight. “I am the leader of an orchestra. It’s the music that has to be a hit, not me as the orchestra leader,” he says.
Here’s to the master conductor holding many more symphonies.