Thirumangalam Election

There are very strong rumours doing the rounds about the use or misuse of money in the Assembly bi-election held in Thirumangalam, Tamil Nadu a few weeks back. The grapevine has it that Rs.10,000 was the price of a vote. TV’s showed one of the leading political leaders handing over money to a voter openly. Possibly, the Rs.100 crore spent on the election will soon be reclaimed several times brimming over through persuasion or coercion. The winner is now the hero because his guilt has not been nailed.

Raju – From good to bad

Ramalinga Raju was by all accounts very good during the initial years of Satyam. He was known and admired for instilling a culture of quality and efficiency in his company. Then hubris took over, convincing him that he would forever remain the darling of the country and he could do no wrong.

This emboldened him to fashion two pies for his sons, in the form of infrastructure and real estate companies – ventures which require heavy greasing and political patronage to stay in business. He dug deep into Satyam coffers and thus started his descent from good to bad. He was caught and thus became the villain of the nation – and rightly so.

The depth of the Satyam tragedy lies in the fact that people who were in the know of things chose to look on, without seeing, or pretending not to see. The rot was all pervasive and everyone close to Raju became fallen heroes because of their silence and refusal to stand up for their convictions.

Transformation from good to bad

When a young person starts a venture, he is a picture of idealism and healthy ambition. The rat race and greed then begin to take their toll. They bend and crawl, to meet the demands of the political system in the country which encourages patronage, speed money and influence peddling. Expediency takes over moral compulsions. The silence of the co-accomplices is the easiest of things to buy. People who started as good human beings become contaminators of the system – very much like those polluting the holy river Ganges with filth and muck. And sadly, the general public around them becomes immune to the rot around them, accepting them as the way of life.

Nemesis of the bad

There lurks hope amidst all the chaos and murky dealings of people in high places. Perpetrators of crimes are getting caught and brought to book with a heavy hand. Politicians and corporate boards are beginning to realize that the Law of the Universe will mete out to them their dues, multiplied over, and they will all meet their nemesis sooner than later. The Infosys and Wipros of India remind everyone that there is a promise of good things to come for those who remain steadfast in doing the right things, coupled with attention to quality and efficiency.

Cleaning up of the Augean stables

In the aftermath of the Mumbai terror strikes, the media whipped up frenzy, (because danger was at their door, too close for comfort) and forced the politicians to run for cover or mend themselves. They are, with honorable exceptions, unlikely to be partners in the fight against the cancer of corruption and unethical practices because they are part of the devious system, depending greatly on the crumbs, grace and patronage of the political class. Raising a hue and cry depends on you and me, refusing to be onlookers when horrible wrongs are committed right in front of our eyes. And, as Gandhi said, we have to become the change we want to see.

Today, we are entering the 60^th year of our Republic. We owe it to ourselves and the generations to come, to force the politicians to mend their ways. Then, and only then, will the significance of the statement of purpose and vision found in the Preamble to our constitution begin to make sense.

The preamble to our constitution assures the following.

We, the people of India, having solemnly resolved to constitute India into a sovereign socialist secular democratic republic and to secure to all its citizens:

Justice, social, economic and political;

Liberty of thought, expression, belief, faith and worship;

Equality of status and of opportunity;

And to promote among them all

Fraternity assuring the dignity of the individual and the unity and integrity of the nation

There is a lot of hope hidden behind those words if we the people of India learn to demand them as our birth right.

For India at 60, you and I are the rays of hope.

Image Credit: Bug A Lug

Popularity: 11%

I recently got to attend a much sought after talk, wherein the speaker was a renowned expert in his own domain. His claim to fame was the application of best practices from the automotive and other age-old industries to the relatively newer era of technology management. He was adept with the likes of Lean Management, Agile development methodologies, Xtreme programming practices, etc and he spoke passionately about these, at length.

I came out really excited, with some out-of-the-box thoughts to try out on a team that was willing to be the scapegoat for my experiments! A topic that he briefly touched on was something that, in hindsight, could easily be extended to beyond just software development. This topic of interest to me, was “Pair programming”.

I am sure those with exposure to ‘extreme programming’ paradigms know all about it, and more! But to those uninitiated in the jargons above, “pair programming” is just literally what it is – a pair involved in the programming i.e. rather than have just individuals working on their own programming problems, a pair of individuals are involved in putting their heads together to solving the same problem.

The advantages he quotes are many – having someone to bounce thoughts off, a senior mentor to guide a junior engineer, equal peers having each other watch over so that defects are reduced, learning from each other’s experience (read: mistakes), etc. The applicability of this practice or the success measure of this practice isn’t really the point of write up. My thoughts are about scaling this, and looking beyond software or technology management. It is about extending this to corporate governance.

With the recent disclosures around Satyam’s senior management (or the lack of it, considering none except one individual seemed to have any inkling of internal reality), it led me to think what if there were actually a pair involved in managing the affairs of a corporation. To lead on a possible modality, how would it be if every public listed company had a pair running the organization – one being the executive that’s managing inside-out (this is the traditional CEO role as the public face of the company) and the second one in the “pair” being the external representative.

He / She would be appointed by the majority stakeholders as their face or voice. There might be concerns as to the veracity of the second appointment, how a consensus is to be reached amongst the shareholders, etc. Of course, I don’t have the answers to all these questions, but I am sure we cannot work out a magic formula that would work for every single organization out there.

Each entity is as unique as it can get and it is in the best interests of each organization to determine the best way to select the second part of the “pair”. This is crucial because this piece of the puzzle would need to work hand-in-glove with the ‘traditional CEO’ in making sure they are making decisions with the best interests of the company , both at heart, and in soul.

The independent board of directors, unfortunately, don’t make the cut any more for they are too independent to be involved. As the story goes, they want to be the chicken and not the pig! (non-committed vs. committed; for more background on this, Google “chicken, pig and Agile”!)

The need of the hour is a committed bunch (or two) – someone who doesn’t have the same vested interests as the CEO, but at the same time has accountability to deliver, and is committed to this as a full time position.

Of course, the much talked about CEO compensation would be back in focus, for there is now a 2x outflow. But I am confident that seeing the long term health of the company in good hands, and the shareholders’ interests continuously and independently protected, is a fair enough price to pay for this model.

As a parting thought, is there a hidden message in “pair” being a part of “repair”?

The onus is on every Indian, with exposure to the West, to undo the damage that the Satyam saga has done worldwide, so that the questions surrounding corporate governance in India are put to rest once and for all!

Image Credit: Mike Baird

Popularity: 9%

Dear Hyderabad,

Hi!!! How are you? I am doing well and I hope you are doing well too.  It has been a very long time since we met and had a very long catch up.

I wanted to apologise to you for not being in contact with you for so long. I am a little busy with the things happening in my life here in the UK. I would definitely tell you everything in person when we get to catch up. Any way, enough about me and tell me what is up with you?

I heard that there is a lot of political disarray going on in your life. What is it all about? Are you able to cope with it perfectly? I remember you telling me that you would solve this by the mid of this year. Well all the best Hyderabad. Hope you will solve it soon.

Also heard that one of your good friend from Satyam had been into shady transactions and now been arrested. Why did he do that? What went wrong? He was one of the best persons you were proud of. Sorry to hear that.

Hey what is your stand on prevailing traffic problems? Any luck in that case yet? Heard there are lot of freeways, highways and flyovers being constructed? Hope every thing will go well which is good for you and me as well.

London, my friend here in the UK, said ‘hi’ and wished you a happy new year. I have a great time with him. But, I cannot wait to see you. Convey my regards and love to my Mom and Dad. I am going to pay a visit as soon as possible. We can have fun as we always used to do and especially we can have your hand made biryani.

Miss you.

Love,

Bhaarath

P.S. Hey by the way, congratulations on your new airport. Few of our friends showed me the photographs. It is awesome.

Popularity: 10%

I  am writing this article with a sense of pride for what I have seen just a couple of hours ago.  I have never witnessed something like this before and I am not sure if I will witness something like this in my lifetime.

I was working from home today and was supposed to have a meeting with my boss at 4.30 PM EST. As I was about to get into a meeting with my boss, another colleague of mine pinged me to ask – “Hey did you hear about the accident ?”…Not having a clue I asked him “Which one ?” …He said “The Plane” ….and my heart stopped for a second.  For a second, I had wild thoughts and prayed that nothing like that ever happens to anyone.

Then he pinged me again to tell me “Just check CNN” …and immediately I logged onto CNN and I saw this headline “Airplane crash-lands into Hudson River; all aboard reported safe“.

The news read

A US Airways plane with 155 people on board ditched into a chilly Hudson River on Thursday, apparently after striking at least one bird upon takeoff from New York’s LaGuardia Airport, according to officials and passengers. Everyone on board was accounted for and alive, officials said. About 15 people were being treated at hospitals and others were being evaluated at triage centers

I was relieved.

In the last couple of months , I have heard of so many untoward incidents- the Mumbai massacre, the Ghaza assault, the market mayhem, the Satyam fiasco etc. I wasn’t ready to hear another tragedy. Thankfully CNN gave me the good news – All of the passengers were reported safe.

Today is a day that New York will remember its heroes for many reasons – for the valiant efforts of the coast guards, the heroic efforts of the pilot, the selfless duties performed by the crew, the NY Waterway team, the NYPD team and many state and national agencies who took it upon themselves to save 155 passengers from a sinking plane, fighting cold and adverse weather conditions.

What a brave effort ! My hats off to the rescue team and the brave passengers who beat death miraculously.  You don’t often come across such miraculous efforts or events in life. Today was one such day.

So, coming to the point – What can India learn from this ?

Preparedness for accidents

Accidents do happen. But you must be ready for all eventualities. Preparedness for the worst will always make you come out victorious in so many ways. A life saved is a million blessings earned

Presence of mind

If not for the presence of mind of the pilot and his crew, the NY Waterway team, the NYPD team et al, the rescue effort would have been difficult

Teamwork

This was a classic example of excellent teamwork where the private companies and the government security agencies worked hand in hand and the administrators provided all support

Presence of Toolkits

The team that swung into action had their toolkits ready – ropes, life jackets, blankets, comforters etc. There was the presence of doctors, psychologists, policemen, firemen, ferry staff – all with one mission – Save as many lives as possible.

How often do you see such things happening in India ? And how long does it take to get to the action spot.  I am not criticizing, but what I heard is it took some 9-10 hrs for NSG to reach Hotel Taj before they got into action – all because they were waiting for some neta to come.

Value Life

The success of these missions definitely depended on how much each individual and the state alike valued those lives that were at risk. I think India has to learn a lesson or two from this rescue mission’

Immediate Action

There is no time for paperwork, approvals, debate etc. First save lives, then talk. The Emergency Response Team here in New York showed tremendous grit, determination and swiftness in swinging into action and rescuing all the passengers.

Share knowledge, but sometimes learn too

When the terrorist attacks happened in Mumbai, investigators from all around the world reached Mumbai and were quick to learn the pitfalls of the rescue mission. Their main objective was to learn from experience and take all preventive measures back in their country. Can we see a similar team from India sent to New York for some learning ?

All said and done, it is the result that matters. In eventualities like this, there are many such lessons to be learnt and how much proactive you are to these situations shows how good you are.

Lesson in a nutshell : Prepare for the worst. Hope for the best !

Image Credit: DP Styles, JKrums

Popularity: 11%

Last couple of weeks we saw a drama unfold – a drama that shocked millions of shareholders of Satyam, its 53000+ employees and a nation of a billion people – surely it appeared to be the scam of the century, as far as India is concerned.

In the days that followed, the Government took some stern measures – in that it arrested the Raju brothers, appointed a Board which promises intellect, respect and most of all experience that can sail this army of 53000 employees to a feeling of security, build confidence amongst its investors and lead from turmoil to victory.

Today, the market was abuzz with another news on Satyam. This time with the (t)rumour that Vivek Paul, the erstwhile Vice Chairman of Wipro, is touted to be the next CEO of Satyam Computers.

We don’t know how far this is true but it is believed that his entry to the company will bring a lot of confidence amongst the investors.

So, who is  Vivek Paul ? Let’s take a sneak peek at Vivek’s corporate biography

1. Vivek Paul is known in the outsourcing industry as a turnaround king. He turned Wipro from a mere $150 million company to a billion dollar IT giant by 2005 – all in a span of seven years.
2. Vivek joined a Private Equity Firm, Texas Pacific Group as a partner in 2005 but resigned from the firm in Dec 2008. Some say because he wanted to take active participation in Satyam. In fact, it is believed that Vivek wanted to lead a management buy out of Satyam or mount a take over bid through CSC (Computer Services Corp)
3. Vivek Paul was named among the best managers by Business Week, among the top 30 most respected global CEOs of the world by Barrons and among the top influential business managers by Time magazine.

So, with all these credentials and a company like Satyam which has a plethora of challenges to be tackled including streamlining the finances, reassuring the clients, instilling faith in the company, winning the confidence of the employees and most importantly proving to its shareholders that for Satyam it’s a new beginning, Vivek has certainly a lot to win over.

The question is will Vivek (Wisdom) take over Satyam (Truth) as its CEO ?

Time will tell…For now, see this interview by TiECon

Image Credit: Eleaf

Popularity: 8%

You’ll invariably find a PS note at the end of an article. I don’t mean to be different and start with a PS note. I just reckon that this article might hurt a few sentiments and hence want to be sure that I clarify a few things upfront!

PS: This is just my point of view on something that is fundamental to the Hindu religion. I don’t mean to ridicule or question a religion that I believe and practice. I am just airing out a few questions that I have in my mind… and being in the corporate world, I think these are conflicts of interests!

So here we go!!!

India being a Hindu country – I have no clue on the stats, but know for a fact – a vast majority of us here are Hindus. I grew up in pretty strong Hindu tradition where my grandparents and parents repeatedly told me the importance of doing the right thing, being truthful at all times and the price that one will have to pay in front of the lord for being dishonest and selfish.

I still remember my grandparents telling me that if you lie, the gods will poke your eyes! I am sure every south Indian Hindu would have heard this or a variant of this in some shape, form, size or color.

Super – all things that are in the spirit of doing the right thing and living a guilt free life!

I saw a post on rediff.com – http://specials.rediff.com/money/2009/jan/12slde1-pooja-havan-to-help-raju-get-bail.htm

A group of Hindu pundits are performing a Pooja and Havan – invoking God’s help – to help with the bail application of Ramalinga Raju, which the courts said no to a few days back.

If the dharma says that forgery and cheating are crimes that the gods won’t tolerate and forgive – how is it that these Hindu pundits are out to invoke the same god, to save a criminal?

Save someone who has himself confessed that he is a cheat?

Save someone who has swindled public money for private gains?

Save someone who forged documents to take himself to such great heights and made corporate India look like a bunch of jerks eventually?

Isn’t this a conflict of interest? Isn’t this something that would drive the gods crazy??

I now know why we say the Gods must be crazy!!

Popularity: 11%

Over the last few days, there has been so much of attention given to Satyam, Ramalinga Raju, his admission, his arrest etc.  The entire corporate world is speaking their heart out against Satyam and its founder.

One aspect that received less attention is the Corporate Political nexus.

This is very evident in the Satyam saga.  Although the politicians ,the Naidus and the Reddys of the world,  are trying their best to stay away from the Rajus, it is a well known fact that Satyam’s progress and the awarding of the various contracts in Andhra Pradesh and the other parts of the country could not have been  possible without  ”Under The Table” dealings.

A controversy not so long ago in rewarding the Hyderabad Metro project was brought to everyone’s notice and Mr.E Sreedharan had quite famously said about the rewarding of the contract as

“Making available 296 acres of land to BOT to Maytas consortium was like selling the family silver”

It is a known fact that without the politicians, the corporate honchos are helpless in getting contracts after contracts. And without the contributions from the corporate, large scale spending on elections and self progress can never be achieved. 

While it may be extremely difficult to prove, given the fact that everyone connected to the Satyam scam would have washed off their hands and destroyed all or any of the remaining evidence so, the existence of relationship between big businesses and the politicians can not be denied. This nexus has only seen the common man suffer.

So who are these sufferers?

The worst sufferers are definitely the employees and the shareholders of the company. 

Spare a moment also for the hundreds (if not thousands) of future entrepreneurs who would not even dare to start a venture in India, knowing very well what they will have to compromise on their ethics and morality to be rewarded contracts.

How often do you see the likes of a Narayana Murthy or an Azim Premji emerge victorious without actually paying heed to the politician’s demands.  And if you dare to be different from the rest, you are often harassed mentally and in some cases physically until you succumb to the political pressures.

Given such environment to do business, it will be indeed surprising that how many small businesses and entrepreneurs will be able to make it big in India.

A dream will remain a dream if the lawmakers in India do not make exclusive provisions to severely punish those politicians and the corporate who indulge in unfair practices. There has to be a fear for the law of the land.

Last decade saw India leaping after the economy liberalized.  Now that some of the moles are out, the government should take extreme measures to ensure that the future years will be profoundly remembered as an age of trust, honesty and transparency where a rejuvenated India will emerge and a common man can dream…and dream big!

Popularity: 17%

Huh, this is my favorite subject these days. All across the blogosphere, you will find stories about how media should follow code of ethics before reporting; verify the facts before they publish, how they should dress up before presentation blah blah. Looks very fine and readable on papers. When it comes to implementation, even the top trips.

Talking about journalism, media and reporting, you can talk about them all day long and you will never be tired.

Basically these reporters can be classified into two categories. One those who make nothing out of stories and the other who make stories out of nothing

The latter are called as Hooh Haah reporters.

Here are a few glossy examples. The report reads “India watches as Satyam goes down”

1. My Home Hub, Satyam

Is India watching the building glass  ? Or some painters, cleaners. Where is Satyam going down here ? In fact I see Satyam being cleaned, painted. That tells me they have additional money for spending on their building. That is a sign of progress   Someone please tell them !

2. A Crisis Situation

It says “people looking at a large screen displaying India’s benchmark share index…..” . I don’t see any benchmark index, nor do I see any large screen. I see a Sardar showing his four fingers. Could it be that the Sardar is a well dressed assistant cameraman? All the ingredients of Hooh Haah reporting, must say.

3. Up In Smoke

I laughed over this one for long. I see four guys posing for the photo graph with cellphone in their hand and some made up expression. Again – Where is Satyam in the picture? Nothing in that photo suggests that the photo is from Satyam.

..And the text talks of “Smoking Break”. Where is the smoke, I ask you ?

4. Out in the Open

What was the intent ? Do you see Satyam ? How do you know from that photo that she is an employee of Satyam ? – May be the Id card, but nothing is visible you see

5. On Guard – So what does it tell me, huh? Are you telling me that a Guard outside Satyam’s office is watching Satyam going down?

6. An Onlooker

Oh ! That’s just a good photograph. Again, where is the large screen as claimed ? How do I know this old man is concerned about Satyam ?. Ditto with The Aftermath Wake up, do some good reporting !

7. Wreckage & Tense Situation

Excellent photos. Monitors do look like trade screen. But considering the credibility of all the above photos, this one fails to impress me besides the quality of photograph.

Welcome to the age of Hooh Haah reporting !

Image Credit: Alex Steffler

Popularity: 11%

Satyam! A name that needs no introduction and a name that is in the news for all the wrong reasons!!!

While what has happened is a horrific, isolated and hopefully a standalone incident, the real repercussions are felt by the people who work there. As someone who started his career in Satyam many years ago, my heart goes out to all of them.

Satyam’s business was all about people. To their credit, they did a terrific job in terms of attracting a lot of top talent – Satyam’s talent database is a treasure trove with folks with the dream IIT & IIM combination, Engineers from the brightest and best institutes around the country who chose to make a career in IT. They have them all.

Leadership (while being associated with the chairman who fell) across functions is pretty solid too. Some of the best people managers that I have met in the business were in my early days there. Learnings from there have been invaluable for me personally and I think I was extremely privileged to get campus picked and work with some fabulous peers and leaders.

Not for the skeptic, they have a few people who are a waste of office space and furniture too! Let me not deny that. These are folks who were “loyal” to the “Raju” and moved from being Executive Assistants and Front Office Executives to Project Managers – They were a disaster. They were where they were for the loyalty factor.

I am not surprised one bit to see the Raju community still backing the actions of their ex-chairman and Bhimavaram going ga ga to buy shares of Satyam which is heading to become another General Motors- Worthless!

There’s also a website in his name where people STILL sing praises…now this is simple sycophancy!

It’s unfortunate that the actions of one man and his greed have led a bunch of really talented people to doldrums. I sincerely hope and pray that these talented people get picked up somewhere / somehow.

Good clients have led the way making offers to some of the stars that work on their assignments. While the talent market is stale, there is always a space for niche and I am pretty hopeful that some of these really good folks there get picked up in due course of time.

Signing off, did we see something similar to this and Lehman – GREED!! Isn’t it an age old saying that greed kills… How true!

There are some things that are a legacy and these never change!

Image Credit: Swami Stream

Popularity: 11%

There is no doubt that Ramalinga Raju is India’s biggest scamster. This is definitely a lesson for the corporate honchos of India. Undoubtedly India’s Skilling will be behind the bars, having duped several thousand investors and shareholders for unimaginable sums of money. Shareholders and investors will be behind his life even when he is in prison. For all you know, he might be sentenced on multiple cases leading to life imprisonment.

Now what ? Things can not be undone, right ?

Prior to the Maytas fiasco and his candid confessions, he had built a reputation of excellence in corporate governance. We all now know that was a facade. For all the good things he has done in his life, a few instances changed the course of his life and he became the bad boy of Corporate India.

For all that he is capable, I am sure Ramalinga Raju has it in him to do a lot of good for himself, the society and the entire nation. Different matter if he doesn’t want to. Here is a brief analysis as to what he can do to regain at least some portion of his lost reputation.

1. Accept

It is one thing to commit crime and another to accept in its entirety. Ramalinga Raju has accepted his role in cooking the books. There is no point being in a state of denial any further. What he needs to do is to accept the reality, face consequences and may be act in a manner that will bring his image back, at least to a certain extent.

2. Open Pandora’s Box

This is a great opportunity for India to clean up its company affairs and Ramalinga Raju can help the Anti Corruption Squad, CBI-CD team to help achieve their goals. Since he doesn’t have anything to lose, Raju can turn himself as an approver and  name all the black moles that he dealt within the government, his accomplices who helped him, the names of those officials who took kickbacks, politicians who amassed wealth in return for favours etc. This is the time to crack down on corrupt officials – both in corporate world and government

3. Donate assets

Although Ramalinga Raju came from an aristocrat family, he acquired over 6500 acres of land through his real estate company Maytas properties and was among the Top 10 landlords of India, after milking Satyam for his personal gain. Now that the cat is out of the bag, one way of regaining trust is to sell these lands and donate it to charity for better uses.

After all, how much land would he or his family needs to live the rest of their life.

4. Reforms in Jail Management

After he is sentenced to imprisonment, Ramalinga Raju would have a great opportunity to utilize his skillsets. After all, he has been the Chairman of a multi-billion dollar company. The jail authorities, police etc could use Raju’s entrepreneurial abilities to bring about reforms in jail management.

5. Write Book (s), Teach Lessons

Raju could write a book about his life, experience, the many lessons he learnt etc in the form of an autobiography, while he is in jail. This could be his favourite pastime as well. He could also write books on management, creative accounting, greed etc such that the next generations can read and avoid getting into trouble – consciously or unconsciously.

May be he could take up teaching the inmates and many others a few lessons that he has learnt in his life. May be with the help of the authorities and the support of the inmates, he can make a social change.

6. Practice Yoga

They say Yoga gives you health and wisdom, makes you more spiritualistic. Raju should take up yoga, become more spiritualistic and lead a healthy, corrupt free life from here on.

7. Inspire Jailmates

Raju was an inspiration to many before he hit the headlines this Tuesday. His leadership qualities, his company’s surge to dizzying heights were examples of how a family run business can be managed professionally. Now that he has lost it all, there is a natural tendency for the common man to pounce on him and demand a pound of flesh. Fair enough.

But when he goes to jail, he will meet like minded criminals who would have been languishing there for some time with no hope for rehabilitation. This could be an opportunity for Raju to become a Munnabhai and inspire the jailmates.

After all, inspiration is in his blood – for the right or wrong reasons.

8. Be that change

Maya Angelou once said,

I’ve learned that people will forget what you said, people will forget what you did, but people will never forget how you made them feel

Sure, Raju made all of us sad. He broke our hearts, he took our money and put a blemish on India’s corporate image.

Can he change for the better ? Sure he can. There is an opportunity for Raju to make people feel good again – to be that change !.

As Maria Robinson said

Nobody can go back and start a new beginning, but anyone can start today and make a new ending

Satyam Shivam Sundaram !!!

Image Credit: Mykl Roventine

Popularity: 10%

Many of us have been talking about Ramalinga Raju and his candid confessions. Spare a moment for the man who built the country’s fourth  largest IT empire and gave livelihood to over 50000 families for over two decades and hope for millions of shareholders. 

Don’t get me wrong – I am not siding with Ramalinga Raju for what he has done, nor with Satyam’s pseudo corporate governance which is fairly and squarely to be blamed for.

All I am asking is – Is Raju the only one to be blamed for ?

From the letter, it is apparent that he is taking all the blame on himself. Should we not look beyond what is seen in black and white ?

Common sense tells me that

a)    CFO is to be equally blamed for
b)    External and Internal Auditors did not do their job properly
c)    Banks also played a role
d)    Regulators for not having the right oversight
e)    Independent Directors of the company

…and may be some immediate family members who were privy to such information.

I also suspect the claims of some of the Directors who say they were shocked and that they had no clue about what happened.

How can you not know about something of this magnitude when it is orchestrated by those with whom you spent several hours in a day discussing the various aspects of business, for several years?

Is that you did not pay attention or is it you are not intelligent enough to ask the right question?

Any which ways, these Directors also will have a lot to be answered for.

Popularity: 12%

When Ramalinga Raju, a man who has been in the corporate world for 20 years tried to push Maytas deal, I suspected something is fishy. Finally the cat is out of the bag.

He has revealed the Satya (truth) about Satyam at least for once.

“Sorry I have been cheating you all these years.  Today I couldn’t do it anymore as it has reached an unmanageable proportion. I have been cooking up books all the while and its one damn lie. Accounts have been fudged and there is no cash at all.”

We have seen stock market scams but corporate fraud of this proportion is unheard of in India.  Yesterday was one of the nightmarish days in corporate India.

This will have a terrible impact on the IT sector in particular and Indian economy in general.  Think about an investment banker sitting in New York who wants to invest money.  He will be telling himself, “I can’t believe these numbers anymore.  Let me not get tricked by these figures and trapped into unwanted scandalous circumstances. It’s only for the good to avoid this market”.  Investor community will de-rate our market like what has happened to the Russian market.  This fraud will have ramifications on investor confidence.

A person like Ramalinga Raju, who founded Satyam and took it to such heights and one who is considered a local hero has become a zero today.  As a common man today I am forced to think twice before believing in any individual’s credentials and integrity.

Share holders and employees are the worst hit in this fiasco. Satyam is an F & O scrip and yesterday morning it was at Rs 116 and by afternoon it reached Rs 50.

The stakeholders, especially LIC and Fidelity who hold more than 5% of stake each (more than promoters’ stock), should take up the battle against the Satyam management.  It’s good that Maytas deal didn’t go through as it would have given opportunity for Raju to transfer non existing cash to Maytas and continue with the Satyam drama.

This brings into light the role of other partners in crime – the audit firm PWC and the independent directors.

For 6 years PWC has been auditing Satyam’s books and didn’t even check the bank and cash balances of the company.  We think that the big 5 audit firms do a great job. Enron debacle proved it wrong. And now Satyam fiasco has confirmed that these top 5 audit firms are as immoral as any other crooked auditing firms.

Also this raises questions about the role of Independent directors.  They are supposed to be independent and ask the right questions and oversee that the objectives of the firm are met. All the independent directors are highly reputed and they didn’t even bother to check the balance sheet even once.  I strongly believe that they are also aware of this. 5000 crores is not a small amount that can be withdrawn from the bank and get away without anyone’s knowledge.  What is more surprising is that no one has even asked for the CFO without whose knowledge this could have happened.

To restore faith in investors and investment community all the directors should be arrested immediately and put behind bars; their assets confiscated.

I fear that there are other companies that are hiding skeletons and the appropriate actions taken now should send a strong message to them that frauds of this nature will not be taken for granted.

When issues like these come to light everyone remembers and recollects the phrase ‘Corporate Governance’ Most of the time it has remained a seminar topic and not a real life practice.  Government and Institute of CA’s should come out with a concrete course of action to prevent this kind of frauds in future and take measures to implement corporate governance rules.

Popularity: 11%

It was a day of drama, question of integrity, fraud and a cacophony all across the business giants. The confession from Mr. Raju has not only soiled his own company’s reputation but I guess its going to bring rest of the Indian IT companies under microscope by the International Clients.

Everyone might say it’s an isolated case but coming years are sure to have additional regulatory measures from International Clients on IT companies from India. I am just perplexed how this inflated fraud-cash-bubble sustained for so long. One would wonder what was SEBI and auditors doing all the while? It’s not wrong to be greedy to become number 1 company, but it’s absolutely unacceptable to be number 1 leaving morals to the wind.

The “Trust” factor on Indian IT Hub is at stake now. Will this incident shy away the investors from our IT hub and look for alternatives best possibly to our competitors? Not sure. We have seen in the past, industries failing when Integrity and Governance fail. It’s a fresh lesson leant hard way for everyone on how strong the corporate governance should be in the industry now.

On top of all this, it’s the trauma each of this company’s employee undergoing and regretting to be associated with the company. We were not expecting much of economic recession in India unlike other countries mainly due to low cost services. But this incident could possibly lead us into a recession kind of state if investors to give second thought on investing in Indian companies.

This is the time our government should ensure that no such incident repeats to save our IT hub from ignominy.

Popularity: 11%

When the Sensex swings wildly from day to day, and when the RBI and the Government takes measures to fight the liquidity crunch by cutting down Cash Reserve Ratio and decreasing the interest rates, a common Indian is bound to have questions.

Is it a good time to buy ? Do you think that stock prices will fall even further ? Sensex has taken a big hit, it has lost nearly 50% from its year’s highs – do you think this will continue or will it stop?

Our gut feel is that for long-term investors, now it is an outstanding time to buy. We can’t tell you where the market is going in the short-run. But definitely can assess an opportunity for the future. Unless you need to pull cash out of your account in a big way over the next couple of years, you should be buying.

Specifically, best-of-breed operators with healthy cash flows and strong balance sheets.

There are some outstanding, low-risk values out there today. Blue chips like Reliance Industries, Infosys, Reliance Communications, DLF, L&T, ICSA, Satyam Computers etc boast safe, sizable dividends that will pay you while you wait for the market to turn.

Why settle for a 6% yield when you could lock in a better yield on a blue chip with tremendous upside? It is difficult to believe that these blue chips will not give you more returns than an average Fixed Deposit over a 5 year period.

It takes nerves of steel to buy in this market, but remember that no great investor ever made their fortune buying high and selling low.

So keep making those buying decisions and resist the urge to stash your cash under your mattress. Years from now, when you look back on the decisions you made about your investments, you’ll be very glad you did.

Remember the old saying

Popularity: 15%

The Hyderabad based company, owned by Ramalinga Raju  is in news these days for the right reasons. Against the rough weather in US and other parts of the world, here is one company which is standing tall against all odds.

When most of its competitors are coping with the adverse market conditions, Satyam seems to be leading the pack with some astounding results to its credit. Let us look at some of the facts and figures and then analyse why they are so.

Same time last year, Satyam reported a 46% increase in the revenue and a 37% increase in profits. This year it reported a revenue increase of 49% with an increase in earnings of 27%, slightly lower than the market expectations. I am not getting into details of the segment wise income distribution for now, but it will be interesting to see how it has performed over the quarters under various regions or SBUs (Single Business Unit)

This might look strange but the fact is anything closer to last year’s result is a super achievement in today’s testing times. There are several reasons why Satyam is doing extremely well. Here are a few which is definitely worth taking note of.

Diversifications

Satyam is more diversified than its competitors, both geographically and client sector wise. It has its presence in package implementation, manufacturing, financial services, consulting besides technology, media etc.

Increasing Clientele

Satyam boasts of a large clientele list – It has its presence in over 185 of the Fortune 500 companies. Whoops! That’s stunning by any means

Rupee depreciation

For every 1% dip in the rupee value, Satyam gains 0.3% – Now calculate the net impact on its revenue, if the depreciation is closer to 10%. Wow!

Hedging the Rupee

Satyam is one of those few companies which hedges against the rupee volatility. Net impact – Satyam is protected against unfavourable movements of the currency

Value based acquisitions

Recently Satyam acquired a couple of companies – one from Belgium and the other from Chicago. Both are value based acquisitions

Despite all this, the future is not all that rosy. Oil is a big concern. In fact, it is a national problem and I don’t think Satyam will be able to pull it this time. If it did again, then this will be the company to watch for in the coming years.

What it has done so far is beautiful, what lies ahead is only to be seen. Speculators – Put your hands in the pocket. Time to cash in !!!

Satyam Shivam Sundaram!!!

Popularity: 10%