Simpler structure, transforming employees: A Frenchman sitting in Paris turns Wipro around

BENGALURU: Wipro was the top, or maybe the No. 2, revenue growth performer among the big four Indian IT services companies in the quarter ended September.
Acquisitions make these conclusions a little complicated, and companies are not often forthcoming about their organic growth numbers.
But, considering previous revenues of Wipro’s two major acquisitions this year – of Capco and Ampion – and considering Infosys also made acquisitions over the past year, it is safe to say that both these companies had dollar revenue organic growth rates of 19-20%.That’s much better than that of TCS and HCL Technologies.
It’s a remarkable turnaround for Wipro under Thierry Delaporte, the former Capgemini executive who took over in July last year.
After a decade or more of underperforming its peers, during which it saw Cognizant and HCL overtaking it in total revenue, the company seems to have found a direction.
The stock prices too reflect that – Wipro’s share in the past year has risen 107%, as against Infosys’s 52%, HCL’s 48%, and TCS’s 33%.
In an interaction with TOI on his first visit to India since taking over, Delaporte said he de-complicated Wipro’s complex structure, reduced hierarchies, empowered employees, and transformed the culture from one of being order-takers to being problem-solvers.

Simpler structure
The structure, he said, was “so complicated that after two months, even I was unclear about how this would work, to the point where I felt I would not even try to understand how it works, because I’m going to break it anyway.”
There were seven sectors, broken down into 31 industries, and nine geographies. The sectors and geographies, Delaporte said, were disconnected from each other. There were, in addition, 12 business lines. What Delaporte found particularly difficult to understand was that there were “27 P&Ls (profit & loss units) reporting to me at my level.”
Every P&L tends to be a silo. “Every time you create a different P&L, you are adding walls in an organisation. People are spending more time negotiating with one another, fighting about who will pick up the cost and who will get the revenue credit, as opposed to working with the client,” he said.
Delaporte broke this entire structure down into just two global business lines, and four strategic market units (geographies), and in a manner that the business units and market units had to work with one another. He shrunk the P&Ls reporting to him from 27 to a mere 4.
All of these, he said, reduced the silos internally, so that “it is no longer an obstacle for employees to dedicate their time to their markets.”
Another practice that Delaporte could not fathom was the number of KPIs (key performance indicators) used to assess executives and employees.
“We had over 800 KPIs. Can you imagine how many people we need to just build those KPIs, and track them! I have simple KPIs. If you are not growing, you are not going to be in this organisation anyway. That’s a simple KPI. And there are some others. So, simplicity, over perfection. The more KPIs you have, the more precise you are, but it is not working that way in an organisation of 220,000 people,” he said.
The restructuring also involved establishing a team that would focus only on constructing and contracting large deals worth several 100 million dollars.
“We were counting on our sales teams to sell big deals. That cannot work because if you don’t define specific themes and specific profiles for that, no one will take the risk of going after big deals,” Delaporte said. Large deals can take upto 18 months to close. A sales person whose performance is assessed based on monthly and yearly signings will prefer to go after small deals. Large deals require a very different mindset to shape, structure and negotiate them. “Now, not one single executive committee meeting starts with anything other than big deals. It’s driving an obsessive focus on deals,” Delaporte said.
Another element of the restructuring was to reduce the number of layers in the organisation. An important part of that was to bring account executives – those who have the primary responsibility for an ongoing business relationship with a client – closer to the CEO.
“Before the reorganisation, we had account executives 6-7 layers below the CEO. I remember some of my first meetings with clients. There would be 4-5 people (from Wipro) in the meeting and account executives were at the bottom. It’s very silly. Now, they are just three levels below. It means a lot to the level of speed and escalation. And it’s about empowerment,” Delaporte said.
Transforming employees
The other big transformation was around people. About 30% of his time, Delaporte said, was dedicated to building a great team. This focused on two issues – getting employees to work with each other, and getting them to work with customers to identify their pain points and suggest solutions instead of waiting for the customer to tell them what to do.
“We are not here to just sell what we have, that time is gone. Every company I talk to wants to know how to transform to better connect with their clients, open new markets, or be more efficient. So you need to come proactively with ideas, leveraging your expertise and technology,” he said.
Delaporte felt many in the leadership did not have the personality and mindset he was looking for. “We replaced a third of the top 300. You haven't heard any noise and bad press around it. I think we handled it very well,” he said.
The other element of this was a culture change movement, spearheaded by chairman Rishad Premji. “We had to mature the organisation so that people would be able to work together, to understand what it means to be One Wipro. We needed a culture of accountability, a focus on outcome as opposed to a focus on effort, which was very much the culture of Wipro before,” he said.
Premji dedicated a lot of time on a programme they call “5 habits.” These five were around being respectful, being responsive, communication, trust, and showing stewardship.
“A lot of colleagues have told me they are now attracting talent they were struggling to attract in the past. It’s a recognition of the fact that we are a more confident and aggressive company,” Delaporte said.
It’s still too early to say whether Delaporte’s first-year success will sustain. If it does, it would be a case study in how a new CEO transformed a mammoth company of 2.2 lakh employees, sitting remotely in Paris, and never visiting the company’s headquarters, and its biggest base, in his first 15 months.