BENGALURU: Rajesh Gopinathan takes over as chief executive of TCS at a time when the Indian IT industry is facing perhaps its toughest challenge — of adapting to radically new digital technologies including cloud and automation, and the protectionist environment that US president-elect Donald Trump seeks to create.
Gopinathan joined TCS in 2001 from Tata Industries and drove the company's then newly established e-business unit in the US. He went on to be the vice president of business finance, responsible for the financial management of the company's individual operating units, and was appointed the chief financial officer four years ago.
"Rajesh Gopinathan is a rare combination of business and financial acumen. I am confident he will lead TCS to greater heights," outgoing chief executive N Chandrasekaran, who becomes the chairman of Tata Sons from February 21, said in a conference call with analysts. Assisting Gopinathan will be S N Ganapathy Subramaniam, president of TCS Financial Solutions, who has been elevated as chief operating officer of TCS.
TCS is the single largest revenue generator for Tata Sons, contributing about 90% to its coffers but has faced headwinds in the last two years as the IT landscape changed abruptly. The company grew at a rapid pace between 2009 and 2014 but has since slowed due to its inability to build a stronger consulting practice and the management's reluctance to buy small firms for technologies like design consulting and data analytics.
The immediate task for Gopinathan, who graduated from Regional Engineering College, Trichy, and who is an alumnus of IIM Ahmedabad, would be to try and get back to industry leading growth rates. Cloud necessitates changes in business models and other new digital technologies implies the existing talent has to be reskilled.
The traditional information technology services delivery model in India has been under stress for the last two years also due to pricing pressures and clients splitting up multi-million dollar contracts among different vendors.
With the United States looking to restrict the usage of H-1B visas, Indian companies such as TCS may have to hire more in the US, which may increase costs.
Earlier this month, a legislation demanding that outsourcing firms pay at least $100,000 a year to employees who work in the US was introduced in Congress. Experts believe such a move could hurt profitability. Gopinathan has to operate in an increasingly constrained environment.
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