Wipro’s Rishad Premji: Start-ups can do for India what IT did in late 1990s
Wipro’s chief strategy officer Rishad Premji on why it’s foolhardy to write off the Indian IT industry and Wipro’s start-up investments
Bengaluru: Rishad Premji, chief strategy officer and executive board member at Wipro Ltd, completed a decade at the software services company this year, having joined in July 2007. Premji, 40, who travels about 100-120 days a year, has given less than half a dozen interviews over his 10-year stint. “I’m just a reserved and a very private person,” Premji, son of chairman Azim Premji, said in an interview on Thursday, his first on-record interaction with the media in six years.
During the hour-long discussion, Premji, who also oversees the company’s strategic investment arm Wipro Ventures, shared his learnings from the stint, explained why it is foolhardy to write off the Indian information technology industry and spoke about Wipro’s approach to investing in start-ups. He does not want to run the company, and remains content in his current role, he said. Edited excerpts:
You don’t engage with the media much. In fact, since joining Wipro in 2007, you have given less than half-a-dozen interviews. Why not engage more with the media?
You know I am just a reserved person and I don’t have much to say. I’m not the formal spokesperson. It’s just in my nature or DNA. This is not something which I naturally enjoy doing. And moreover I’m a very private person.
In July, you completed a decade at Wipro. This last decade has seen its own sets of challenges for Wipro…
First of all, if you had asked me 10 years ago, did I see myself here (at Wipro) 10 years later, I would have said no. So, despite what people may think, I have never been on this structured path where I knew I would be doing this for these many number of months or years doing this or another job. I came in with an open mind to learn and with an open mind to contribute.
How is Wipro embarking on this transformational journey?
One of the things we have done over the last couple of years is that we have called out very boldly and disruptively that we will invest in those areas—whether organically, inorganically or through a partner ecosystem. And these things, I believe, have started paying dividends in mindshare capture and mindshare change. If you look at Designit (Wipro bought Denmark-based Designit for $95 million in July 2015) with 300 strategic designers, we have grown that to 500 people. So same with cloud company Appirio (Wipro spent $500 million to buy Appirio Inc., a US-based cloud services firm in October 2016). The good news is that we have been able to do that. Make them culturally work. Integrating it right. We have been able to drive and maintain what is unique about them yet also leverage with Wipro. We have gotten out of the gates early and if we get it right, the opportunities in this end-to-end digital transaction play is limitless.
You mentioned that you had never planned that to be at Wipro for this long. So what kept you going?
I have this unique relationship and opportunity with Wipro. When I was at BFSI (the banking, financial services and insurance vertical, in 2007), I was brought in by Girish (Girish Paranjpe, then co-CEO) with the mandate that we have this huge opportunity in the mortgage space to provide platform-based services. We did a good job in the mortgage space.
Then the integration of the captive unit of Citibank, which had its own challenges, but it went off well. The account today is very significant and we are a very strategic partner to Citibank today. Then I had the opportunity to move to investor relations. That gave me the opportunity to articulate the strategy of the company better. I was meeting 150 investors a quarter. So that was a great source of learning.
So it was a great opportunity to articulate Wipro’s strategy and I did it for six quarters. Then I moved into the role of chief strategy officer (in January 2011). All these transitions happened incidentally. I moved from having worked in the mortgage to Citi because of the acquisition we had made, then to investor relations as there was an opening and then to strategy as the person heading it was moving into the (Azim Premji) Foundation.
Wipro over the last few years has struggled to keep up with industry growth. What is missing in this entire story?
We acknowledge and appreciate we have not done as well as the competition in the last few years. We have had a relatively poorer job of execution. (However) we have also publicly called out that by the end of this financial year we should be in line with industry growth.
The traditional IT services model and market has changed or is changing. So how far down the path are you? Is your model completely baked or are there still things to be done?
So, in the journey there is absolutely no defined start point or end point. We have been on this journey for the last two years as we believe we will have an opportunity to transform our customers forward on their own digital journeys. We are investing boldly, arguably faster, and over the next three-five years we will see the benefits of all this. So, digital revenues accounted for 22.5% of revenue at the end of the June quarter, and we are clearly seeing growth in digital spend (28% year-on-year).
How is it running Wipro’s $100 million venture fund, Wipro Ventures, and what are some metrics you take to evaluate the success of its investments in start-ups?
I would submit that the mindshare capture we have got because of Wipro Ventures with our customers is of a high multiple. So the measure of our success is how can we generate order book for both of our start-up and for us as Wipro. We typically invest in companies which are in Series B, Series C time frame. That is the essence of Wipro Ventures. We certainly want to make returns on investments. But it is not a treasury play.
Again, how do you respond to many commentators’ predictions of the death of India’s IT outsourcing industry?. More importantly, save for some cosmetic changes, why are companies shying away from taking some bold steps?
I think this entire talk of the death of Indian IT industry is overstated. Over the next three-five years, there is a huge opportunity. Certainly it will get more competitive and there will be pricing pressure. If you ask me where the large chunk of our revenue, the source of profitability, the source of cash over the next three-five years will come from , we will be still to a great extent looking to the traditional. So don’t... write off the traditional business.
“Democratizing management” was how your father Azim Premji once described to me the way he runs Wipro. Your family is the single largest shareholder in the company. You are also chief strategy officer. Do you think alignment is complete between management and shareholder owners?
I’m very much at Wipro in this capacity of chief strategy officer. So I’m wearing this hat most of the time. But I very much believe that the hats of management and shareholders are not in conflict with each other. Management recognizes that one of the key roles it has is to enhance the benefit of shareholders. I don’t see them at tussle with each other. I can’t think of a single time in the last 10 years where the two have been at conflict or one has to select one at the expense of the other.
Where do you see yourself going forward? Running Wipro at some point of time?
One of the things that has worked well for me is that I have not over-thought the future. So I’m going to follow this approach. Abid (Abidali Neemuchwala) is the CEO and I work for him and he is on a terrific run in transforming the company over the last couple of years. I’ve been on the board to represent continuity and stability of ownership, which I believe is important considering the stake the promoter family has in the company. So I’m taking it one step at a time and I’m very much enjoying this job and I can still support Abid and chairman of the board.
Your father Azim Premji has a very significant interest in philanthropy, especially in education. Where do your philanthropic interests lie—towards education or any other area?
We collectively as a family very much share a passion and focus on philanthropy. We all feel very unfairly privileged and we feel it is our responsibility to partake and contribute. Our focus is on two folds. First is from operating entity, Azim Premji Foundation, which is focused on education... The second thing is from the balance to education. Azim Premji Philanthropic Initiatives. That is the grant-making initiative. Now there are two approaches to that. We focus on value of grants which we give to vulnerable groups. The other is where we will give strategic grants. So one area is nutrition. We are working with the state of Odisha to drive reduction in stunting in the state. So from over 50%, we are looking to bring it down to 40% over a seven-year time frame. So here we work with multiple NGOs but it is much more a strategic role.
After your 10 years in Wipro, have people in the company come to the point where they can openly disagree with you and tell you when they believe you are wrong?
All the time. Our leaders are tall people and they can get big jobs anywhere they want. So they are not here (because) it is a sort of mai-baap (mom and pop) sort of organization. It is very professional. I can get my computer fixed faster than most people perhaps, but that’s where it stops. But I would not overrate (the fact) that people listen to you just because you are related to the chairman.
What are your thoughts on the Indian start-up ecosystem?
I’m not as actively close to the Indian start-up ecosystem as others may be, but I’m hugely hopeful of the potential of what can get created in India. The start-up ecosystem can do for India what the IT services did for the country in the late 1990s, early 2000s, in terms of being a huge employment creator, a huge wealth generator, a huge brand builder for the country. We can debate the timing and in how many years or so but I’m hugely optimistic.
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