Wipro MD Thierry Delaporte resigns, Srinivas Pallia to succeed as CEO
- Wipro's Thierry Delaporte has stepped down from his position of MD and CEO of the tech major. Srinivas Pallia will be Wipro's new CEO, according to the tech major's statement.
Wipro Chief Executive Officer (CEO) and managing director (MD) Thierry Delaporte has resigned from his position and Srinivas Pallia will succeed him as Wipro's new MD and CEO, the tech major said in a regulatory filing to the stock exchanges on April 6. Delaporte’s tenure as CEO was to end in July 2025 but was cut short with his resignation declared in the late hours of Saturday.
Delaporte will be relieved from his duties as CEO from May 31,2024. ‘’The Board of Directors noted the resignation of Mr. Thierry Delaporte with effect from April 6, 2024. He will be relieved from the employment of the Company with effect from the close of business hours on May 31, 2024,'' said Wipro.
Srinivas Pallia, who was the CEO for the company's America region, will take over as the new new CEO and MD from April 7, 2024, for a period of five years, said India's fourth-largest tech major in its statement on Saturday. Palia is a Wipro veteran and has spent over three decades at the tech company.
‘’Pursuant to the recommendation of the Nomination and Remuneration Committee, the Board of Directors has approved the appointment of Srinivas Pallia as the Chief Executive Officer and Managing Director of the Company with effect from April 7, 2024 for a period of five years, subject to approval of shareholders and the Central Government as may be applicable,'' said Wipro in its statement.
Srinivas Pallia is Wipro's new MD and CEO
“His client-centric approach, growth mindset, strong execution focus, and his commitment to Wipro's values, make him the perfect fit as we enter the next chapter of growth and profitability,” said Rishad Premji, chairman of Wipro, on Pallia’s appointment.
While Thierry was a rare non-Indian to lead a homegrown IT firm, the company seems to have shifted from its approach of hiring an outsider for the top job by promoting an internal candidate for the CEO’s position. Pallia has served Wipro in various roles, most notably as the president of Wipro’s consumer business unit prior to his stint as the Americas CEO.
“It’s been apparent that Wipro needed a candidate that is either internal or someone who had left. As with culture, it takes an outsider to make massive change and it takes an insider to bring back the core of the culture,” said R “Ray” Wang, founder of Constellation Research.
"Srinivas is the best bet they have right now because he has been through the change that Thierry (Delaporte) put in place. He knows what worked and what didn't and more importantly, he knows how to fix it. His numbers in his region have been good and he has shown he can perform despite bad conditions. Now he has to figure that out for the other regions," added Wang.
Pallia will be filling in the shoes of an executive who oversaw Wipro’s largest ever acquisition and also someone, under whom the Bengaluru-based IT major could not sign a single mega deal since 2020. The only mega deal under Delaporte was with German retailer Metro AG in December 2020.
Delaporte's tenure in Wipro
Delaporte, in his resignation letter, said it was an ‘incredible honour to have played a role in the growth and success of Wipro’. "During my tenure as CEO and MD, we have witnessed a significant transformation within the company that has not only driven financial growth but has also positively impacted our associates, clients, and shareholders," Delaporte was quoted as saying today.
LiveMint reported in 2023, that Delaporte was not not worried about a series of senior management exits because he is trying to transform the company, and some people who are not aligned with these objectives would leave.
Delaporte had that said Wipro Ltd will return to a “great level of growth" when market conditions improve, in an interview where he defended his leadership style. Delaporte, who took over as Wipro boss in July 2020, also said in the interview, “There is nothing inside the company that would make us grow less now than two years ago. So, there is no doubt that when the market is going back, we’ll get back to a great level of growth.''
Wipro is expected to be the only information technology (IT) company out of the top four Indian IT to end financial year 2023-24 (FY24) with a revenue decline.
The IT company in its December quarter commentary, projected its revenue to change by -1.5 per cent to 0.5 per cent, implying that the IT major could end FY24 with a revenue decline of 3.7 per cent - 4.1 per cent from FY23. The company is also witnessing a lacklustre fiscal in terms of its revenue, which declined for the third consecutive quarter to $2.66 billion in Q3FY24.
Also Read: Wipro's stock price rose 121% during Thierry Delaporte's tenure, revenue up 47% in last 14 quarters
The IT company’s underperformance is also reflected in its profitability. The company reported an operating margin of 16 per cent for the quarter ended December 2023, which is 10 basis points lower than the September 2023 quarter. When Thierry took over in July 2020, the company reported an operating margin of 19 per cent.
Delaporte’s push to usher in new talent to orchestrate change within the company, resulted in a spate of exits. The company saw more than 750 top executives ranked general manager (GM) and above, leave the company. Out of this, at least 22 senior executives ranked senior vice-president (SVP) and above left the company since Thierry had taken over as CEO.
Catch all the Business News , Corporate news , Breaking News Events and Latest News Updates on Live Mint. Download The Mint News App to get Daily Market Updates.
MoreLess
First Published:6 Apr 2024, 07:24 PM IST
- Top Gainers
- Top Losers
- 52 Week High