Just to give a brief info about this company that we are talking....
Satyam was founded in 1987 by Ramlinga Raju and at the start of 2009 the company had operations in around 60 odd countries and around 53K employees. with 185 of the fortune 500 companies as its clients. and of around Rs. 7.3K Cr. It was Indias fourth largest software company..
And then came june 7th 2009...the day probably very few people will forget...
Ramlinga Raju...wrote a letter...explaining to the world...that "The Satyam Saga" was infact a fraud...and they didnt have money to play around....the game was almost over..
Now lot of people already know what is happening...and will know whatever happens to satyam and its founder...Ramlinga Raju....through the newspaper...But what the guys working in satyam are thinking...and what is going to happen to the guy who committed the fraud..
Lets consider the situation of a Satyam employee....
As somebody employeed by satyam...it is definitely a scary situations....there are rumours that the company may close down...as they dont have money to run the organisation.... As an employee...whats the worst that can happen????? They may have to go to other organisation...for a job...like TCS, Infy and Wipro... and they will start working there...but what really hurts is the feeling that you worked in an organisation...which lied to the whole world...about its standards...and directly ro indirectly..or may be by mistake...employees were part of that... Feel deeply hurt... but everybody knows...its not their mistake.. now they can go home and post the resume on the Naukri.com or Monster.com...get some good offer...and move on...
For a minute consider the staff strengh of Satyam. Its around 50K!!!!! that is HUGE.....Govt is not idiot enough to let them be jobless in an election year...it surely would try do some justice to these 50K+ people... They will get some good jobs elsewhere... and there are standards with other MNCs so you wouldnt be working on a paltry sum.... you will be getting what you were getting earlier. As a satyam employee you are save safe....may be you will be doing a job hunt for some time...but you will surely get anothe job...and you could be happy there... the satyam employee at the end of the day is safe...saved....
Lets consider the issue for the Ramlinga Raju....
I guess one of the most important things to consider is...this guy generated jobs for over 50K+ people over the span of around 20 years...50K is huge number...may be some organisations will see the generations of people before they can even think of achieving something as magnanimous as that.. but he did that by falsifying the accounts and using shoddy practices... and now he is not able to find the way out of the big hole he himself dug..so he declares that he used bad practices...and now he has run out of options..and he is ready to face the law...I mean..what is he trying to do now?? Show his honesty? Show his integrity?? Where was that till the scam became so big? I dont understand this whole game. Until now..since he was able to get his way around the things....so he was happy to do so....but today he has run out of options...so he goes on top of the building and shouts that he committed a scam and he is ready to face the law? Is it some kind of joke? I hope he understands that he has jeopardised the life of nearly 50K people..
I never met him personally in life...or neither I have any chance of meeting him...so I cant make a personnel remark about that person...but I dont think anything achieved with fraudalent practices can ever be appreciated... I mean...I am sure he is a great leader...and he did create 50K jobs...he did create lot of wealth for lot of people..none of the above things are possible without being a very good leader.
But whats the use of it???? At the end of the day..people dont see the gray shades of human nature; all they see is things to be black or white...and his actions definitely fall into the black region which is enough to call him the "bad guy" everybody would want to kick right now. I guess thats the human nature and thats the way world wants to run.
Lot of people may have sympathy for him now but there is little they can do. He himself has confessed to be a fraudster and has to be punished. We have to make some stringent laws and follow them so that people dont even think of doing some like that again.
But there are few questions still left to be answered and would be glad to know answer to all of them
1. What were the auditing firm PWC(PriceWaterhouseCoopers) doing for so long? I mean you take millions of rupees as their charge and then for every question the customer asks you charge him certain amount and at the end of it still give you fudgy output.?
Are they involved in the scam? Honestly I dont know but what I do know is hiding such a thing is not an easy task and a big hole of about Rs. 7K Cr is something auditors can surely catch.
I guess PWC already facing a case for its complicity in case of GTB(Global Trust Bank) and honestly people will start looking at every firm audited by PWC to be a fraudalent one if PWC doesnt improve its standard. More importantly if the govt is going to punish Raju, I would like to see the PWC also facing the heat because...on the surface it looks like they are partners in crime..nothing I can prove..but there is a very simple human logic and it looks pretty obvious. Doesnt it?
2. Is the govt also blind enough that it could never find any discrepancy? Isnt that hard to believe? May be it relied on the reports by its auditors who were also corrupt..
Whatever may be..it looks like the Raju is going to face big problems and the satyam employees are safe for now but who knows...in India situations can always alter...and that too...within few days..and you would be amazed at the speed at which these things happen...
PS: I guess we all should appreciate the govt for the swiftness with which the govt has moved and appointed the new board which will make sure the company doesnt burst and so many people are left jobless. The govt may have shown complicity at lot of times...where we expected it to move but this time its really appreciable the speed with which they have moved. For once lets congratulate the govt for doing a good job...and on time....most importantly...saving life of around 50K people....
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In 3rd paragraph I think you wanted to write Jan in place of June
ReplyDeleteAs always - I think you have studied a lot before writting this blog. Can you write the minutes of your study in another blog so that Idiot like me (who do not get newspaper at home and who do not watch news) can also understand some insight about this fraud? i.e. What exactly happened? why Raju got transformend from Bachchhan to Shakti Kapoor in eyes of millions of people?
ReplyDeleteMy apologies. You are right Ashish. I wanted to write January instead of June but not sure if i can edit the blog now... anyways...
ReplyDeleteabout minutes of study...thats a separate chapter all together...so we will discuss that sometime later.
Anyways, coming back to what exactly happened..how the fraud was committed...is something SEBI and govt is trying to find out..but prima facie it looks like Raju created fake invoices of orders they had got. He tried to show greater profit margins and money than he actually had. Guess he tricked banks (or they volunteered????) to believe that he is parking large money with them which never came into the banks... And above all banks never questioned any of the documents ever provided or never tried to cross verify...
Once Raju had a profit it became difficult for him to show losses ever..also he had to make sure that company makes enough profit; so that there are no outsiders bidding to take control of the company..which may be created need for showing bigger money and resulted into bigger fraud...
Thats what is prima facie situation...but details will let you know as soon as they appear in paper and news media... :)
I agree with what is written to an extent only, Why because:
ReplyDelete1. About Satyam Employees: The whole world knows that they have nothing to do with all these. I agree they have fear of losing job and many may not get a job or get a job for lesser salary but still they will survive with their heads up.
2. About the Government: I differ in this point. Govt. has to come for rescue. It is not only about Satyam like for eg: ICICI has given 60% of Satyam employees home loans,personal loans etc.. let's take an average that each employee took 10lacs then what will be ICICI's position if no one wills to pay back. You will see a big lock on the door perhaps. Like these there are many things that can happen.
Govt should have acted much fastly. For 3 days nothing happened. Now they are raiding all the offices, many people (politicians) got enough time to bungle up things here and there.
3. About Mr.Raju: Yes he has made his business huge by telling all lies. But so you think all corporates are not doing this. Atleast he gave jobs to 53K people but what about our politicians???? they are eating all our tax money and without any guilt thye are roaming freely and again getting nominated.
Why the world doesnt see grey shades. According to me we are the people who make this worls. Each individual's thinking counts. Infact i say nothing is black and white everyhting is grey.
I am not supporting Mr.Raju's crime but where is the good will he earned for years. he made 53K families run their lives smoothly. People who lost their money are mostly investors, these were the people who gained like anything when IT boomed. I feel it is very easy to kick a man when everything is going against him but for me he is Great. It takes a hell lot to become like that.
Who is the sufferer: Raju's family has to suffer for ages. Because the way in which media is potraying his image is very bad. I feel sad that an enterprenuer like him will be wasted. The vision he has is hardly found in many. Luck did not favoured him as he was not able to close the gap. (Remeber Dhirubhai also had a time almost like this but not this bad).
Anyways it is like "DUNIYA UGE SURAJ KO SLAM MARTI HAI' but one thing for sure is dubne par bhi SURAJ SURAJ HI REHTA HAI......
(Sorry if i wrote too much)
There are many spelling and grammatical mistakes. sorry for that
ReplyDeleteThanks Ketan for information, with little reading from news and after talking to friends I understood the explanation you gave in above comment.
ReplyDeleteYou can edit blog - log into the blogger and you will get option to edit post. Once you edit your post you may delete my first comment.
Hey priya i agree that Raju is a great leader. Without such a great leadership he couldnt have created something as big as Satyam. There is no doubt about that..and i did mention that saying "for few organizations it will be generations even before they can think of such a huge employee base."
ReplyDeleteI also agree with you on the fact that..almost all businessman use wrong methods to stay in the business. And only those who get caught are the culprits..others are the crown of the Indian industry. And thats the way world sees it. One wrong thing is big enough to ruin all good things done by anybody. Havent we seen this in our day to day life? I mean..around us..things like that happen daily right??
Everybody in the world is trying to cash on the mistakes of the other...and it likes to see the darker side of everything. There are very few people who want to see positive things even in such a bad situation. I appreciate your point to bring out the extra-ordinary leadership skills of Raju in this case.
And about the govt. I still believe it acted pretty fast. The enormity of the declaration by Raju was so big that even the over-active media could not get the exact details of what was happening. How do u expect the government to take control of that? But yes once it knew the situation; it did jump in and did a good job.. Afterall its a government madam..i was thinking that it will never act...but it did and tried to save lot of lives...thats what surprised me the most..thats the reason I want to appreciate them.