Hyderabad: The top leaders of Satyam Computer Services Limited have launched an immediate action plan to ensure business continuity and leadership transition, while initiating steps to ascertain the batterred IT firm's liquidity position and verify allegations of financial irregularities by its founder and chairman Ramalinga Raju.
In a sudden development that shcoked investors and corporate India, particularly the IT majore, resigned from the company yesterday saying that the company's figures had been inflated over the past several quarters.
Addressing a press conference, chaired by Satyam's interim CEO Ram Mynampati at Satyam's headquarters in Hyderabad, the company's senior managers, who have stepped in to take charge of the country's fourth-largest IT firm (See: Satyam's top managers vow to stay to resolve crisis) said that the company has started to actively reach out to customers globally and has received strong expressions of confidence and support from them.
The senior managers of Satyam are currently steering the organisation through the crisis, with approximately 40 top managers representing the 'leadership council' from various geographical regions have pledged their commitment to remain in the company.
In his letter to Satyam's board, founder and outgoing chairman B Ramalinga Raju had suggested that Mynampati be appointed interim CEO, to restore the company's credibility andd steer it out of the present mess (See: Full text of the letter from Satyam Computer chairman B Ramalinga Raju and Ram Mynampati takes over as interim CEO of Satyam)
Mynampati announced several immediate steps already carried out or being undertaken by the the senior managers that include:
- Formulation of a Task Force to address all ongoing operational issues to ensure business continuity, including maintaining customer confidence.
- An immediate customer outreach by all geographical regions to assure clients that Satyam will meet all its business commitments.
- ''Many clients rely on Satyam for mission-critical functions and collaborate closely with our team. While we have to address various customer concerns, we have been heartened by expressions of confidence and support from various clients,'' said Mynampati. Satyam's top 100 customers account for 85 per cent of total revenue and have had relationships with the company ranging from four to 10 years.
- Assurances to the approximately 53,000 associates from leaders and line managers that the company's places top priority in protecting the careers and livelihood of employees and their families. ''We share the pain and grief being felt by all associates and their families and will do our utmost to ensure that salaries can be paid,'' Mynmapati said. ''We are extremely touched by the outpouring of support from associates.''
- Begun a process to ascertain Satyam's financial liquidity position and verify allegations by the chairman. An independent audit is being contemplated.
- As part of efforts to strengthen corporate governance, leaders have accorded top priority to addressing various legal issues that are expected to unfold; and written to the regulatory authorities and various industry associations for assistance to identify candidates to be new members of Satyam's board.
Mynampati said that the immediate action plan announced were collectively decided by the senior managers, based on an initial assessment of the key challenges. These actions will be reviewed by the leadership team on a daily basis for the next few months.
''The leadership team comprises highly experienced veterans with cross-functional responsibilities across geographical regions, said Mynampati. "They have also been mandated with additional tasks of great urgency including collection of accounts receivable, cost containment as well as customer and associate retention. At the onset we wish to stress that the leaders have offered themselves to steer the organisation through the current crisis."
- Active outreach to global clients even as customers affirm support and confidence
- Senior management pledge to stay with company; send message of assurance to approximately 53,000 associates
- Will consider appointment of audit company for immediate investigation into allegations by founder and chairman Ramalinga Raju and to establish position of cash and bank balances
- Seeks nominations from regulators and industry associations for candidates for board
- Recognises need to strengthen corporate governance and cooperate with investigations by regulatory authorities and address legal issues