Industry insiders gave a nod of approval to Wipro’s decision to appoint company veteran Srinivas Pallia as the new CEO instead of opting for an external candidate. The move comes as Wipro has been grappling with sluggish business growth in recent quarters. Pallia, who previously served as the CEO for Wipro’s Americas I business, steps into his new role following the premature resignation of current CEO Thierry Delaporte, whose contract was slated to run until July 2025.

Analysts widely praised the move, citing the potential disruptions and transition period that hiring an external CEO could entail. The departure of several senior leaders under Delaporte’s tenure, including Stephanie Trautman, Jatin Dalal, and Sanjeev Singh, had caused significant upheaval within the company, disrupting existing business relationships with clients.

According to Phil Fersht, CEO of HFS Research, bringing in someone familiar with the old Wipro culture was crucial for stabilizing the company after the upheaval caused by Delaporte. He noted that Pallia and Suzanne Dann, CEO of Americas, were natural choices, emphasizing the importance of having leadership based in the US.

Gaurav Vasu, founder and CEO at Unearthinsight, praised Pallia’s swift ascent to the top post, highlighting his leadership in Wipro’s North American vertical, its largest market for IT services. Vasu cautioned against the high costs associated with hiring external CEOs, particularly for a company like Wipro, which is currently experiencing slower growth compared to its peers.

Yugal Joshi, Partner at Everest Group, noted Wipro’s prolonged struggle with performance and suggested that the appointment of Pallia was a long-awaited development. He expressed hope for a turnaround given Wipro’s strong technical capabilities.

Wipro’s underperformance in recent quarters, marked by consecutive declines in net profit and revised revenue growth guidance, has underscored the need for strategic leadership. Analysts believe that Pallia’s quick transition into the CEO role will position him to address both internal challenges specific to Wipro and broader industry headwinds, such as muted demand and technological disruptions like generative AI. However, the sudden resignation of Delaporte may indicate that the company’s fourth-quarter performance has not shown improvement.

Pareekh Jain, the brain behind EIIRTrend, emphasized the urgency for Wipro to mend its internal dynamics, especially in light of the significant departures among its senior leadership. He stressed the critical need to boost employee morale and stem the tide of senior-level exits. Jain underscored that, ultimately, securing a substantial deal would be essential for Wipro to assert its competitiveness among its industry counterparts. With Srinivas Pallia taking the helm, Jain expressed curiosity about whether he can catalyze the necessary changes to propel Wipro forward in the highly competitive market landscape.

In summary, Wipro’s appointment of Srinivas Pallia as CEO reflects the company’s efforts to address its challenges and regain its competitive edge in the IT services industry.