Industry experts gave a thumbs up to Wipro’s appointment of company veteran Srinivas Pallia as the new CEO instead of hiring an external candidate for the job, as the IT services major struggled to turnaround its business growth over the previous quarters. Prior to this new role, Pallia was the CEO for Wipro’s Americas I business.
Present CEO Thierry Delaporte resigned from the role prematurely despite his contract running until July 2025. .
Analysts unanimously called this a well-thought out move as hiring an external CEO could potentially mean a few months of transition and structural changes. Between Wipro’s last two CEOs, Delaporte and Abidali Neemuchwala, many of the company’s senior leadership members and veterans had silently exited the IT major disrupting existing business relationships with customers.
In 2023 alone, Wipro lost over 10 of its senior leaders including chief growth officer Stephanie Trautman, chief financial officer Jatin Dalal, chief operations officer Sanjeev Singh, among others.
According to Phil Fersht, CEO of HFS Research, a global business research consultancy, the company needed someone to bring back the old Wipro culture. “The board was looking at external candidates but after so much disruption caused by Delaporte the company needs stability. Srini (CEO of Americas I) and Suzanne Dann (CEO of Americas) have been the obvious choices, and having leadership based in the US is very important,” he told Moneycontrol.
He added, “While they looked at outside candidates, they need someone from the Wipro old school to reenergise the troops.”
Gaurav Vasu, founder and CEO at market intelligence firm Unearthinsight, said Pallia's ascent to Wipro's top post will be the fastest transition as they are getting someone who has been leading the company's North American vertical, which is the largest market for IT.
He added, “Hiring external CEOs also comes with huge direct and indirect costs. Wipro at this stage cannot afford any more shocks. It’s the slowest growing firm among the top 10-15 IT companies. Right now, if they would have hired someone externally, the company would have fallen off the cliff.”
Also Read: Who is Srinivas Pallia, the new CEO and MD of Wipro? Here is all you need to know
According to Gaurav Parab, Principal Research Analyst, NelsonHall, the quick transition would see Pallia finding himself in the thick of the action from day 1, dealing with challenges specific to Wipro and also with broader industry headwinds like muted demand, the generative AI disruption, and everything that comes with this election year in key markets.
Yugal Joshi, Partner at management consulting firm Everest Group, said, “Performance-wise Wipro has been struggling for a long time so this latest development was in the making. They have been grooming leaders for this position and Thiery might have some other personal goals as well. Wipro stakeholders need to ask whether it can ever turn around. We are hopeful given its a firm with strong technical capabilities "
Wipro’s underperformance
Wipro has been reporting a fall in net profit for the last four consecutive quarters. As of the third quarter ended December 31, profit has plunged by 12 percent YoY to Rs 2,694 crore.
The Bengaluru-headquarter company had also adjusted its revenue growth guidance for the fourth quarter at both the lower and upper end. It updated its revenue growth guidance of -1.5 percent to 0.5 percent. This came after the company slashed guidance in the range of -3.5 percent to -1.5 percent in the previous quarter.
Analysts noted that the sudden resignation of Delaporte may signal the company’s fourth quarter performance has not been any better either.
“There have been so many senior leadership exits, the company first needs to fix its employee morale and stop senior level exits. Ultimately, they’ll need to win a large deal to compete with peers; let’s see if Srini can move that needle,” said Pareekh Jain, Founder and CEO of industry insights platform EIIRTrend.
Parab added, “Delaporte is paying the price for Wipro's muted growth in the past 12 months and overall underperformance. One must, however, acknowledge his transformation work at Wipro around organisational and cost structures, and focus on large accounts.”
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