Machines cannot take away all the jobs: T K Kurien

Interview with CEO, Wipro

Wipro's revenue from the information technology services business for the quarter ended September was in line with its estimate, though it lagged some of its larger Indian peers in a few operating parameters. Chief executive T K Kurien tells Bibhu Ranjan Mishra he expects a few issues involving a couple of large clients to be resolved in a quarter, before all the company's engines start firing. Edited excerpts:

Wipro seems to have lagged on many fronts - the key banking, financial services and insurance vertical, Europe and margins. What happened?

If you look at our numbers, most of our businesses have performed well, in constant currency terms. For example, European operations fell 1.4 per cent in constant currency terms, though the decline was four per cent in the reported currency.

North American operations grew significantly, and we expect that to remain steady. We expect Europe to improve, though not immediately because we have put a new team there. It will start showing results in the next two quarters.

The growth in your top accounts fell in the September quarter. Was it because of client-specific issues?

We have a problem with three customers in Europe, who are among the top 10 clients. It is because the nature of demand from those clients has changed. It will continue for another quarter. I guess this will be behind us in the fourth quarter.

You had said you wanted to see three quarters of steady growth before announcing a victory. Do you think that phase has started?

It is difficult to say. We will go quarter-by-quarter. This quarter, we have seen growth, after adjusting for currency headwinds. I see enough opportunities in the pipeline. I am not feeling completely disillusioned because I see signs of growth.

What is happening on the discretionary spending side?

In the US, the overall discretionary budget is good. We are seeing headwinds in one or two sectors. For me, the biggest challenge is how to get all businesses to fire together. Right now, three businesses are firing but three aren't the way they should. But I am pretty confident these will fire; it's just a matter of time.

You had hired in large numbers in the second quarter, against expectations the firm would cut headcount because of more automation. What were the reasons?

The hiring in the second quarter happened purely on the back of volume (billable man-hour) growth. It is not true that by bringing in automation, we like to reduce our workforce. It is just about sensationalisation. Machines cannot take away all the jobs but they clearly help up-skill people and enable them to handle complex things and move up the value chain. That is the game you will ultimately see in this space.

Will this aggressive hiring continue in the next two quarters?

The kind of numbers we have hired will drive volumes in the next quarter. So, in the next quarter (December quarter), our hiring will come down for couple of reasons. I will not hire in large number, especially when holidays are due towards the end of the year. It does not make sense, as the new hires will be sitting on the bench. We expect to see hiring return in the fourth quarter.

As CEO, what are the changes you see on the ground?

We have become a very aggressive company; our level of aggression has gone up significantly. But if you ask me whether I am happy with the pace of change, the answer is ‘no’. However, the management team and every employee in this organisation have tried their best. The organisation is trying really hard to take it to the next level, and I am pretty confident that we will.

Recently, you started an ‘open source’ practice. Please share some of the details.

In the past, people developed software using standard packages. Now, there is a whole community working around it. Fundamentally, what happens is some commonly available software is available for free. You can take it, configure and create infrastructure components with it. That’s what we are working on. Today, it is a small practice, with about 3,000 people, but the idea is to increase the number to 10,000.