Technology industry, in India and elsewhere by nature of its volatility, always has its fair share of movers and shakers; the new decade has already seen the first even as it is barely one week old. IBM India has appointed Sandip Patel as the new MD for India and South Asia. He replaced Karan Bajwa who has been spearheading IBM India since 2016 and has now left to explore opportunities outside IBM.
For good measures, IBM Asia Pacific CEO Harriet Green has also retired and replaced by Brenda Harvey who was previously looking after Public Market for IBM US. While Green’s superannuation led departure was easy to understand, BaJwa’s sudden departure has, as expected, set the tongues wagging in the Indian IT grapevine.
While IBM was not ready to dwell into conjectures behind the movements, Bajwa too was not available for comment. So while it might sound too presumptuous to attribute complex and long motives behind the move, what is indeed a surprise was the timing of it. Bajwa has been spearheading the One IBM strategy in India since taking over in 2016.
IBM, which hitherto had several verticals including hardware, consultancy and software, consolidated itself as One IBM in a bid to give enterprises a single point of reference across all products and services from IBM. Landing One IBM in India and successfully nurturing it was perhaps Bajwa’s biggest achievement during his tenure; it had started bearing results in his first two years till 2017 with IBM achieving double digit growth in India including adding 1,000 new clients, scaling up presence in telecom and banking sectors and developing a robust platform for enabling enterprises to adopt new technologies such as Analytics, Internet of Things (IoT) and Artificial Intelligence (AI).
However the One India journey was not yet complete and perhaps that is the reason the departure of the helmsman Bajwa midway has caused consternation and giving rise to these conjectures. Perhaps the not so great ‘performance’ of IBM India in 2019 has been the real reason. IBM India witnessed subdued earnings growth for two straight years as slowdown in the telecom segment affected its revenue and profit numbers in FY19.
IBM India’s net profit in FY19 declined by around 12% on a year-on-year basis to Rs 2,426 crore, as against Rs 2,755 crore in FY18. Its revenues from operations during the period dropped 2.85% to Rs 26,542 crore, compared with Rs 27,323 crore in the previous financial year. IBM India, which used to be one of the fastest growing regions for the global IT firm, has seen some slackening owing to slowdown in telecom segment which used to be its erstwhile sweet spot . While Bajwa’s One IBM was a strategically good move in streamlining and optimizing IBM’s performance, even it could not help IBM offset the damages caused by the telecom slowdown.
Also the appointment of Patel, virtually a home favorite with IBM since 2002, is further leading credence to the theory that IBM is trying to offset the damage as much as possible and avoid a third straight year of southward slump. Patel has been working for IBM’s insurance vertical in Boston and he is supposed to lead IBM’s India recovery especially by further strengthening its BFSI and government business.