Today in Tech: Satyam Verdict; IDC's India market projections & Everest matrices

NS Ramnath
Updated: Oct 1, 2012 01:27:06 AM UTC

Satyam verdict by December: Business Standard

img_4262_satyamfinal_280x210_280x210_280x210Business Standard reports  that the verdict on Satyam scandal is likely to be delivered by end of this year. If you benchmark this against some of the fraud cases in US – For example, Bernie Madoff scam, which broke around the same time as Satyam; and even more complex and difficult-to-prove insider trading scam involving Raj Rajaratnam - Satyam's would seem to be proceeding in a fantastically slow pace. But the report quotes unnamed experts as saying: "given the magnitude of the case.. the progress of the trial has been remarkably fast." (Evidently, they were comparing the case filed by CBI with those filed by Registrar of Companies and IT Department).

For us, the passage of time gives a good sense of its impact on how we look at  businesses these days. It's all for good.

***

In 2001, two business school professors Ashish Arora and Suma Athreye published a paper on the software industry in which they said the software sector served as an exemplar of good entrepreneurship and corporate governance to the rest of Indian industry. They attributed a part of the reason to getting listed in US stock exchanges, and having to comply "with US system of financial reporting (GAAP), quarterly reports and close attention to the investor community and their representatives, the equity analysts, which the firms were anxious to follow as they needed to signal their quality to potential customers." It's fair to say the paper captured the the general perception about the IT sector. It was considered to be professional and clean.  Satyam changed it all. Ever since the scandal broke out, no journalist looked at a press release from any company without wondering why this wouldn't be 'the next Satyam'. That skepticism has served journalism well. (Check out the superb podcast on corporate fraud. My colleague Rohin Dharmakumar, who wrote about what went wrong in OnMobile in the recent issue, and Abhishek Kumar of Indicast who hosts the fortnightly podcast of Forbes India, discussed this subject with Subroto Bagchi, Mindtree chairman.)

Satyam also injected a good dose of healthy scepticism about experts and analysts. Satyam board had some of the biggest names from the world of business, technology and academia. To name two, Vinod Dham, who designed Pentium computer processor, and Krishna Palepu, a Harvard Business School professor regarded as an authority on corporate governance. Some of the most perceptive analysts were tracking the company. After Satyam made an attempt to buy Maytas - the first sign that something had horribly gone wrong at Satyam - some journalists went back to old documents, annual reports, stock exchange filings, analyst call transcripts, to see if there were hints of the scam that they missed. Mint journalists came close to finding one evidence. It was a question an analyst from Kotak posed about the excessive cash Satyam seemed to be holding in current account back in 2006. CFO, in effect, gave a ‘non-answer’. If the analyst was not satisfied with it, it didn’t show till Ramalinga Raju decided to let Satyam buy Maytas two years later.

 

IDC: Indian IT Market to grow by 16.3% in 2012 Received wisdom says that Indians don’t think of anything as valuable till it gets a stamp of approval from foreigners. That certainly was the case with the domestic IT market. No IT vendor seemed to care about the opportunity in their backyards till IBM won a few big deals. Now, IDC says that the India market opportunity is growing. It is expected to grow to $ 43.57 billion in 2012, up from 37.46 billion USD in 2011, IDC said in a press statement - here. This represents a growth of 16.3% in 2012. (Nasscom expects the overall market (including exports) to grow at 11-14%.) In 2011, the big push came from Retail & Wholesale, Energy & Utilities, and Healthcare witnessed tremendous growth (>23%) in IT spending. The trend is expected to continue, IDC said.

Everest's Peak matrices
Everest brought out two reports recently – one on the finance and accounts outsourcing, and the other on procurement outsourcing. In both, it measured services providers based on annual contract value and delivery capability, and positioned them on a matrix. Here they are.

img_4262_satyamfinal_280x210_280x210_280x210

img_4262_satyamfinal_280x210_280x210_280x210

 

Also of interest:

VMware Acquires Once-Secretive Start-Up Nicira for $1.26 Billion: AllthingsD
Cisco to Lay Off About 1,300 Employees: WSJ
As bench gets crowded, IT majors delay hiring freshers: Business Line
Microsoft Assembling “SWAT Team” to Boost Bing: Readwriteweb
Google and Facebook boost federal lobbying in 2nd qtr: Reuters

 

The thoughts and opinions shared here are of the author.

Check out our end of season subscription discounts with a Moneycontrol pro subscription absolutely free. Use code EOSO2021. Click here for details.

Post Your Comment
Required
Required, will not be published
All comments are moderated