Satyam to downsize operations, close offices

A handful of the 105 offices and 30 delivery centres that Satyam Computer Services has worldwide may soon cease to exist.

The Hyderabad-based company, recently acquired by Tech Mahindra, is evaluating options to downsize operations at its overseas development centres and terminate lease contracts for offices and other properties.

By consolidating its offices and delivery infrastructure, Satyam will be able to up capacity utilisation and also reduce overhead costs, two persons in the knowledge of the development told Business Line.

“The concept of global delivery centres is good but all delivery centres and offices will be right-sized both in terms of people and physical infrastructure,” one of them said.
Resurrection Plan

This review of operations is part of Operation Phoenix, Tech Mahindra’s plan of resurrecting Satyam.

Satyam has seven development centres in China, Germany, Brazil, Egypt and Malaysia, which act as near-shore destinations for getting work done in the same time zone as places such as the US and the UK.

A spokesperson for Satyam refused to comment on the news.

In April, Satyamites on bench in the US were asked to quit and return to India.

Satyam has already pruned its sales force across the globe.

However, recent news reports indicate that it plans to increase the sales team by 20 per cent. This could not be verified independently.

Another official said that Satyam is likely to consolidate sales operations in the US as a section of customers based there has severed ties with the company. The company has 14 offices in the country.

Apart from its 10,000 excess employees, Satyam is believed to have 20,000 spare seats in India across the 23 delivery centres.

“We have identified several rented premises whose lease will be terminated to provide sizeable savings. This space is anyway in excess and was invested based on anticipated growth,” Mr A. S. Murthy, Chief Executive Officer of Satyam, told staff in a recent email.
High-profile exodus

Meanwhile, the exodus of high-profile officials from Satyam continues

Those who have quit include Mr Virender Agarwal, Business Head of India, the Middle-East and the Asia-Pacific regions; Mr Hetzel Folden, head of the strategic deals group; Mr Naresh Jhangiani, human resource head of business process outsourcing, and Mr Deepak Nangia, head of the Australian region.

Ms Archana Muthappa, India-based spokesperson for Satyam, too has put in her papers.
Last week, Mr Vineet Nayyar, CEO of Tech Mahindra, had said Satyam has excess staff of 10,000

via BL