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1/13/2009
05:31 PM
Bob Evans
Bob Evans
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CIOs Need To Keep Open Mind On Indian IT Firms

These days, mention Satyam and few of us are likely to think of how it won a prestigious 2008 award from SAP for excellence in customer experience and accelerating innovation, plus two independent awards for shared-service excellence. In a Global CIO column, Professor M.S. Krishnan says customers evaluating their relationships with Satyam cannot afford to dismiss those achievements or the long-term quality of the Indian IT services industry.

These days, mention Satyam and few of us are likely to think of how it won a prestigious 2008 award from SAP for excellence in customer experience and accelerating innovation, plus two independent awards for shared-service excellence. In a Global CIO column, Professor M.S. Krishnan says customers evaluating their relationships with Satyam cannot afford to dismiss those achievements or the long-term quality of the Indian IT services industry.Krishnan, who last year co-authored with C.K. Prahalad the best-selling business book, The New Age Of Innovation, says in his column that while the actions of Satyam founder Ramalinga Raju are reprehensible and must surely give CIOs good reason to re-evaluate their outsourcing relationships, the company's 50,000-plus employees had nothing to do with the financial fraud and are continuing to deliver award-winning work to clients in wickedly competitive industries.

First, despite the corporate governance problems at Satyam, none of their global customers had raised any concerns related to the quality of operational delivery and performance in their projects. In fact, there has been an increase in the size and scope of projects delivered to global customers by the major Indian software firms over the last few years. Hence if it had been a problem related to inability to execute large projects, we would have heard this from the market loud and clear.

Ironically, Krishnan last summer helped arrange for my colleague Rob Preston and me to interview Raju, dropping a letter of recommendation to the Satyam founder as we were trying to lock down our schedules. At that time, and for very good reasons, Krishnan held "Chairman Raju" and the entire company in the highest regard, so Krishnan's perspectives on Satyam's bombshell, plus the collateral impact it's had on other Indian software and services companies, come from someone who is very familiar with all of those companies and their leaders and their customers and their business models.

In that context, Krishnan's column urges CIOs to take the time to separate the actions of Satyam's founder from the performance delivered by the rest of the company; and to separate the legitimate risks CIOs now see in doing further business with Satyam against the proven value it and other Indian IT firms have consistently delivered. It is advice well worth heeding.


Please join us for InformationWeek's Editorial Webcast: "Offshore In India: What's Next?" on Thursday, Jan. 22, at 11 a.m. EST. Editor In Chief Rob Preston and a panel of top executives from the Indian IT industry will discuss these and other issues. Go here to register.

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