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Srinivas had just come out of CEO's office after submitting his resignation letter from the post of Chief Architect of the company. In fact he happened to be the fifteenth senior executive of the company who had resigned from his post on the same issue during last three month, and it had virtually created total vacuum in the top executive level of
the company, which was difficult to fill in near future.

The CEO definitely had a long discussion with him on various critical issues but that had not influenced Srinivas to change his decision. According to him, the massive merger and acquisition initiative which the company had undertaken a year back had completely failed to offer long-term sustainable results. In their meeting, the CEO was of the opinion that due to the massive competition faced by small and mid-size IT companies like theirs, the margins of almost all IT companies were found to be under tremendous pressure. Many so-called big companies were in a position to withstand such pressure due to the scalability factor. However, under such pressure, mid-size IT companies like theirs found it very difficult to survive in the market place and, therefore, rapid expansion was considered to be the only viable alternative. However, even organic mode of expansion was found to be having its own limitations such as overcoming massive skill shortage issues, large investments in training and development, etc. Hence, inorganic mode of expansion was considered to be a better choice at that point of time.

However, Srinivas was of the opinion that it was not the decision of inorganic growth which went wrong, but the lack of attention paid to the basic fundamental dynamics of inorganic growth, and the mechanism to deal with such processes were found to be the major factor management should have taken care of very seriously during pre-merger period. Now, one year down the line, these factors were found to be the most damaging for the long-term interest of the entire company leading to very high attrition rate, escalating hiring cost, mediocre syndrome across the board, rapidly deteriorating brand image in the job market, and low employee morale.

According to Srinivas, like many other small- and mid-size IT companies, their company was still operating in an entrepreneurial mode with little notion of how to strategize for scalability. IT resources remained limited and executives remained busy in focusing their energies on core business initiatives. The ability to adapt and mature in an evolving market environment was lacking with the company, though it was considered to be a critical one. Hence, the company was vulnerable to the massive stress and strain process.

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* Contributed by: -
Joydip Dey is a Post Graduate in Human Resources from XLRI Jamshedpur, and has spent more than 15 years in the Fortune 500 Technology Companies, and is currently VP-Human Resources at Bharti Tele-Ventures Ltd., New Delhi.