Government of India has proactively stepped in to rescue Satyam and control the damage done by Satyam scandal to India’s overseas image. Satyam founders Ramalinga Raju, his brother and financial head of the company are in judicial custody for interrogation. Government has appointed three experts as new board members and looks like Satyam and India’s corporate image will be saved though founders of the company are facing criminal charges and may face severe punishment. Analysts are now trying to study the fall of this giant which ushered outsourcing to Indian shores in the first place.

Satyam was one of the pioneers of outsourcing business in India. Ramalinga Raju became a legend and a hero in his homeland for ushering in new prospects and boosting economy of the state and country. History of Satyam dates back to the time when Raju offered services to his first client almost free of cost with his mantra ‘if you don’t like service don’t pay’ just to build an image of credibility and an empire. Experts feel that it was the competition and emergence of new software giants like TCS, Infosys which made Raju falter and gamble ambitiously to stay afloat. Raju continued to offer services at lesser costs and compromised on profits (made them up by forging). It could be wrong financial and overall management strategy of the company or total lack of it which finally became its nemesis. Added to it was the greed and ventures in to real estate. May be global financial crunch was the final prick that burst the bubble.

While the rise and fall of Satyam will go into business books as there are many a lessons to be learnt from the whole saga but Ramalinga Raju’s rise and fall will be more dramatic.

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Via New York Times