Wipro will soon announce a change in its organisational structure to create enough room for the new chief executive officer, Abidali Neemuchwala, to implement his strategy. The new structure is expected to be announced before the appointment of Neemuchwala becomes effective in February this year.
The structure could see reshuffling of roles including a possibility of formation or merger of some of the business verticals.
"T K (Kurien) and Abid will make a separate announcement on the new organisational structure of Wipro," Wipro chairman Azim Premji wrote in an internal mail to the company's employees.
Earlier this week, Wipro had promoted group president and chief operating officer (COO) Neemuchwala as CEO and member of the Board and elevated incumbent CEO Kurien to the position of executive vice-chairman. The appointments will be effective from 1 February, 2016.
However, industry trackers believe that India's third largest IT firm may not go for "any radical changes" in its organisational structure that could have negative impact including exits at top level management.
The Bengaluru-based IT giant is unlikely to continue with the CEO-COO model which has been in place as an "short-term arrangement" to assist the succession planning, sources familiar with the matter told Business Standard.
If the company sticks to the model in the new structure, then the COO would be seen as the next top level executive after CEO and a "natural choice" for the chief executive post in future.
"Wipro can't afford to do it at this juncture as there are many senior leaders at the top who are vying for that post. Weighing one above the others might destabilise the top management layer resulting in senior attrition," said a senior industry source aware of Wipro's structure and business.
"Besides, there is no urgency before the company to create a clear number two position as Kurien would be around for another 18 months and the new CEO has at least four to five years' time to prove himself," the source added.
The company has already made some major changes including promotion of a few senior executives as presidents before announcing the appointment of new CEO. These moves have already led to some top level exits including Ayan Mukerji (head of media, telecom and product engineering services) and Sangita Singh (head of healthcare & life sciences business).
"Wipro has had more than its fair share of churn in key personnel in recent years with the last bout being after Kurien took over as CEO. There have been a couple of senior resignations recently as well from Wipro," wrote Credit Suisse analysts Anantha Narayan and Nitin Jain in a note published on Monday.
"Abidali has been around for a few months and was widely considered as Kurien's successor. So the risk of further churn could be lower," they added.
Under the existing structure, Wipro has four presidents who oversee various verticals and businesses at the company. All the presidents and chief executives including chief strategy officer and board member Rishad Premji, the eldest son of promoter Azim Premji, would report to Neemuchwala, sources added.