BPO Syntel: Respected HR manager walks
By Annie Paul

Late 2008,  the highly regarded Black Book of Outsourcing published by the Brown-Wilson Group rated Syntel Inc as the top-rated BPO provider to the health insurance industry.  But Syntel insiders tell techgoss that employee morale is at an all-time low within the BPO as the next few months will determine whether its main client renews their contract.

Early August, Techgoss had exclusively reported on the power plays within Syntel and how its future hinges on a few key clients.

Now a Syntel insider tells us that the joss sticks are slowly emerging in Syntel. While the highly respected Syntel CEO, Mr. Murugesh, continues to feed positive tidbits to the media about Syntel's growing focus in Europe and its strength in operational expertise, the truth about its internal operations paints a different picture. The latest Syntel senior to kick the bucket is Global HR Head, Srikanth Karra. He served his last day on August 31 and left abruptly much to the shock of many Syntellites. Srikanth joined Syntel in 2005 from GECIS where he headed the HR function for its outsourcing services. A dynamic and capable product of GE, Srikanth was instrumental in shaping Syntel's growth engine with GE's established recruitment, talent management practices and employee retention strategies.

Srikanth also pulled key HR people from GE or ex-GE to support him in implementing a new strategy and shaping Syntel's people focus. We won't need tea leaves to speculate about a lot of employees following Srikanth's footsteps. Rumored to be joining HP-EDS for their Asian operations, Syntel is now headless across key business functions like HR and BPO-New Business. Speculation is rife that this writing on the wall might indicate Keshav's exit as well. The grapevine also indicates that there are a lot of hungry predators keen to acquire the mid-cap IT company. Keep watching this space for more updates.

(Techgoss had published the following article on Aug 1, 2009)

BPO Syntel future hinges on one client
By Annie Paul

Late 2008,  the highly regarded Black Book of Outsourcing published by the Brown-Wilson Group rated Syntel Inc as the top-rated BPO provider to the health insurance industry.  But Syntel insiders tell techgoss that employee morale is at an all-time low within the BPO as the next few months will determine whether its main client renews their contract.

Techgoss had learnt that 85-90% revenues of Syntel are derived by its joint venture with US based Global Custodian. It all started with Nitin Rakesh who was 'elevated' to the Board of Director's (essentially a non decision making) position from the CEO's seat in the Joint Venture. Nitin, chiefly responsible for starting and growing the BPO joint venture, chose to resign gracefully after a few months. During this period, the BPO was also affected with attrition across unit heads that had been with the BPO outfit from scratch, leading to a heavy management vacuum affecting growth and employee morale.

Very recently, their head of BFS BPO presales as well as the Healthcare BPO chief quit due to Syntel’s lack of investment appetite to invest in acquisitions as well as growth areas. Growth has been limited to a single international BPO client added recently in the last 3 years for offshore BFS operations. Adding to the ongoing woes was the company steadily losing its other domestic BPO client contributing to the remaining 10% of revenues.

With the JV Custodian contract up for renewal in March 2010, many opine that the contract will not be extended and might end up with its competitors like Wipro and TCS who have been successful in delivering cost effective operations to capital market clients as well as in acquisition. The high attrition run rate continues, and in case of non-renewal of the contract, Syntel stands to lose nearly its entire BPO portfolio which will greatly affect the parent company’s market capitalization and global standing. There is a buzz across the entire company regarding the future of its BPO and some go as far to say that Syntel itself might be plucked by a larger organization. While the current JV head is trying to lend a resemblance of stability with creative reengineering within BPO, what lies ahead for the BPO employees is anybody’s guess

Syntel has 3000+ full time employees.