Satyam's new management in June 2009 launched a one-time initiative – Virtual Pool Programme – aimed at addressing staff costs while retaining talent
On January 6, 2009, Satyam Computer Services was was the darling of the bourses in India and abroad. Everything was going great – a strong brand, good showing on quarterly results and optimism all around.
However, its former chairman B Ramalinga Raju’s confession on January 7, 2009, stating he had manipulated the company’s books, overturned the lives of many, especially its associates (as employees were called at Satyam).
Ram Mynampati, who joined Satyam as executive vice-president in 1999 and became the president (commercial and health care) in October 2002, said immediately after the scandal broke out: “We are obviously shocked by the contents of the letter. The senior leaders of Satyam stand united in their commitment to customers, associates, suppliers and all stakeholders. We have gathered together at Hyderabad to strategise the way forward in light of this startling revelation.”
Business Standard met some of the employees of the erstwhile Satyam who now wear the Tech Mahindra badge outside the company’s ‘Infocity’ campus at Madhapur in Hyderabad to get a sense of what they felt immediately after Raju’s confession.
“We were apparently shocked and appalled by the extent of the fraud. Not just us, our families, too, went through an emotional trauma,” recollected M Pavan (name changed), a senior associate who has been with the company for over nine years now. The scam was an example how corporate fraud could turn out to be a bane for employees, he added.
According to Nagesh Kumar, Raju’s inglorious confession looked like a scandal for outsiders, but internally the employees felt it was a clever deception. “We were shaken by the scam and couldn’t believe that this was done by a person like Raju who has earned the reputation as a visionary, putting Andhra Pradesh on the world IT map. The moment I heard about it, a cold chill of fear went up my spine ... the fear of losing my job,” Kumar said.
Rajasekhar, another associate, said employees like him were treated as the staff of a despicable company by the general public. “Until January 7, 2009, we enjoyed a proud status being an employee of Satyam, the then fourth largest software exporter from India. After the scam broke out, people started to look at us, some with sympathy and many with apathy, while banks completely stopped extending credit to us,” Rajasekhar said.
TechM trims Satyam staff
Adding to these woes was the statement by C P Gurnani, then a Satyam board member, who made it clear in April 2009 that the new management was in the process of trimming ‘surplus’ staff.
Satyam had around 50,000 employees before the scam was unearthed. The new management, however, cut this down to around 30,000 a year later. In May 2014, Tech Mahindra, had 89,441 on its rolls.
Hari Thalapalli, the then chief people’s officer at Mahindra Satyam and now the chief marketing officer and global head (business and technology consulting group) at Tech Mahindra, expressed his reluctance to comment on issues related to the erstwhile Satyam's employees.
Satyam's new management in June 2009 launched a one-time initiative – Virtual Pool Programme (VPP) – aimed at addressing staff costs while retaining talent. Initially, close to 10,000 associates were part of the VPP, which was designed to cover associates who had not been in billable roles for three months or more.
“The new management has allayed all our fears and assured us job security, initially by retaining us through the VPP initiative, with reduced pay, though. While it has called some associates back owing to new client wins, it has also provided out-placement services for a few employees. Now, it is life as usual in the merged entity,” said Niranjan, another associate.