India’s largest IT services company Tata Consultancy Services (TCS) announced an unexpected change in its top leadership. Rajesh Gopinathan announced his resignation from the company after a 22-year stint where he donned several roles before becoming the MD and CEO. TCS also announced Krithi Krithivasan, the current head of BFSI as the CEO designate who would take charge of the company starting next financial year. Rajesh will be a part of the company helping with the transition over the next six months and will be in the company till the 15th of September 2023. While the announcement came in as a surprise to the markets, Rajesh said it was something he had been mulling over for a while and felt it was the right time to make the decision. “When I was reflecting on what would be a good time, I felt there is no better time than this and also it was important to do this before the start of the new financial year, so that the incoming CEO, in this case Krithi, has that full runway to play with it,” he said.
On Krithi as the choice of the next CEO to lead the company, Rajesh said given the deep leadership bench at the company, the board had a unanimous decision on the choice. “The board has a very high visibility to a very large part of the leadership team and there is a close interaction on an ongoing basis. So, the top 10-15 people get in front of the board many times in a year, there is a lot of interaction. And of course, Chandra as the chairman knows each and everyone of them personally and professionally for decades,” he said.
Krithivasan, who has spent nearly three and half decade at the company, currently heads the BFSI vertical, which brings in over a third of the company’s revenue. With a 6-month transitionary period, Krithi said though there may be glitches for a quarter or two, there wouldn't be any dramatic changes in reorganisation. “We have a core set of values, focusing on employees, focusing on the customers, is the most important engine that drives our growth,” he said. While his visibility to other verticles and the understanding of the overall business would be on top of his priority list, “we will not make any change and we will continue to focus on core principles and fine tune as we go along,” Krithi added.
With an internal candidate taking over the company, most analysts anticipate the transition to be smooth, with minimal disruption. ICICI Securities, in its note, said: “The announcement of change in CEO was unexpected, particularly as Mr. Rajesh Gopinathan was re-appointed as CEO in 2022 after having completed 5 years in the role since Feb 2017. However, we expect CEO transition to be smooth, since Krithivasan has been with the company for 34 years, serving various customer facing leadership roles and heading the largest industry vertical, BFSI. This appointment is in line with TCS’ strategy of succession planning well in advance and grooming internal employees to take on leadership positions. Additionally, Rajesh Gopinathan will also be available to support this transition over the next six months.”