Survivor with a mission to reassure

Subramanian Ramadorai and his wife Mala like to show off the garden of their holiday house in Khandala, a lush hill station two hours’ drive from Mumbai.

Mr Ramadorai, head of India’s biggest information technology outsourcing company, Tata Consultancy Services, points out the vegetable garden at one end in which he flexes his green fingers from time to time – that is, when it is not being raided by marauding monkeys.

On first inspection, the couple’s elegant home, with expansive balconies positioned to take in views of the nearby mountain peaks, could hardly be further from the high-tech, hectic world of TCS. The Mumbai-based software outsourcing group is one of India’s first true multinationals, with operations spanning 42 countries.

There is no television or even an office here. But Mrs Ramadorai points out a wi-fi transmitter discreetly placed on one of the balconies. “I would never be able to convince him to come up here otherwise,” she jokes.

As the couple sits down with the FT to a lunch of north and south Indian vegetarian food, Mr Ramadorai’s relaxed demeanour gives no hint of the turmoil that is facing his industry.

Earlier this month, B. Ramalinga Raju, the former chairman of the country’s fourth largest outsourcing company, Satyam Computer Services, confessed to defrauding the company of up to $1bn (£733m) in one of the worst scams in corporate India’s history.

In one step, Mr Raju threatened to undermine the reputation of a sector hitherto seen as an exemplar of corporate governance in India and other emerging markets.

The world’s Fortune 500 multinationals entrust their most sensitive computer software and hardware systems and business processes to outsourcing companies in India, which together generate more than $40bn in export revenue for the country.

Regaining the trust of its overseas clients is one of the biggest challenges facing the industry today. This comes as it is also struggling to cope with the fallout of the global economic crisis, which has already claimed the scalps of key clients such as bank Lehman Brothers and telecoms equipment maker Nortel Networks.

“The industry has to step up to communicate a lot more effectively,” Mr Ramadorai says. “It has to...keep saying and reinforcing that India is a great place to invest because of its potential and intellectual capacity.”

Part of this task must fall to Mr Ramadorai, one of the patriarchs of outsourcing in India. Although he is due to retire as chief executive in October after a 36-year career at TCS, one of the key companies in India’s Tata group conglomerate, he is likely continue as a non-executive director.

During his career, he has helped build TCS from a company of just 100 people when he first joined to a behemoth employing 130,000 as of December – more than the regular British army. Since taking over as chief executive in 1996, he has listed the company on the Bombay Stock Exchange and seen its revenues grow nearly fivefold in five years to $5.3bn last fiscal year.

Dressed in a green polo shirt, grey slacks and chappels (Indian flip-flops), the balding 64-year-old speaks slowly and softly. Friendly and appreciative of a good joke, he is the consummate product of the modern, international India.

He established the first TCS office in New York in 1979 and has since spent much of his life travelling the world. There are few countries he has not visited. “I’ve not gone to Iraq or Iran. I’ve not gone to North Korea,” he quips.

Yet despite his international persona, Mr Ramadorai attributes many of the values underlying his management style to his traditional south Indian Brahmin upbringing. The Ramadorai family originally hails from a village near Tiruvarur, in the southern Indian state of Tamil Nadu.

“[My upbringing] was very routine in terms of very strong middle-class values,” Mr Ramadorai says. “It is ingrained in you that you had to do well in mathematics, that you have to be in science, that you have to perform your morning prayers with rigour.”

Between the ages of three and five he lived with his grandmother in the village. It was there that he discovered a love of Indian classical music that he shares with his wife, an accomplished vocalist in India’s classical northern Hindustani and southern Carnatic musical traditions. Tiruvarur, with its “Big Temple”, one of south India’s holiest places, is a centre of learning spanning the arts, science and physics. Weddings in the village would last five days, with classical musicians providing the entertainment.

He went on to study physics at New Delhi University and engineering in Bangalore, later going to the US to gain his masters in computer science at the University of California.

He joined TCS as as a trainee engineer in 1972 after a spell at a US computer company; when he took over as chief executive, he was only the second holder of the title in the company’s history.

His management style differs sharply from his predecessor, F.C. Kohli. Whereas Mr Kohli was brusque in person, preferring contact through written correspondence, Mr Ramadorai sees TCS as a big family and relishes personal contact with employees.

With a workforce whose average age is 27, he sees himself chiefly as a mentor and an instiller of values in a company that last quarter added a net 8,673 employees.

Today his skills are being put to the test as never before. During the Mumbai terrorist attacks, in which more than 170 people were killed, he urged employees to remain calm and pick up the phone to clients to let them know everything was okay.

With the advent of Satyam and global economic turmoil, TCS has received many calls from clients seeking assurances about the group’s probity and financial health. “We have given dividends every quarter since we went public – that’s 18 quarters in a row,” he says. He points out that the company has been undertaking acquisitions and is providing clients and shareholders with details of how it is investing its cash reserves.

The shadows grow longer over the jungle on the hill opposite Mr Ramadorai’s Khandala house and the interview comes to a close. The next day, Sunday, he must give up Khandala’s peace and quiet to go to a board meeting in Mumbai.

But he does not seem burdened by the prospect, perhaps because he knows he will soon hand over the reins to his successor.

Although he will not name the likely candidate, most expect the person will come from within TCS. Mr Ramadorai says he expects this person’s principal challenge will be to complete the internationalisation of TCS as it grows in regions ranging from Latin America to eastern Europe.

“How do you keep the organisation at the same level of growth, the same level of value systems, the same standards of excellence in terms of delivery?” Mr Ramadorai asks, describing the task that is likely to face his successor. “And then there is the acceptance that tomorrow’s leaders could be of any nationality and not necessarily of Indian nationality.”

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