Flipkart has come a long way since group CEO Kalyan Krishnamurthy began his second innings at the homegrown e-commerce company in 2016 — arguably one of its most troubled phases with Amazon snapping at its heels.
A canny operator, Krishnamurthy swooped down and tightened the ship. One of the key areas he addressed then was Flipkart’s bloated, top-heavy structure. With around two dozen senior vice presidents (SVPs), the company was paying millions of dollars in salaries to these executives brought in largely from consulting firms and tech majors like Google. Within six-to-eight months, Krishnamurthy slashed the number of SVPs in Flipkart to just four from 23.
Over the past year, though, the e-commerce major had started promoting its internal talent, many of whom are in their 30s, along with hiring some key executives from outside to reshape its top deck. Two weeks ago, it bumped up Anil Goteti, Rishi Vasudev, Ajay Veer Yadav and Amitesh Jha as SVPs, taking the overall count of SVPs to eight.
These promotions come in the backdrop of Amar Nagaram, head of consumer shopping experience at Flipkart, moving to Myntra-Jabong in a newly created role of chief technology and product officer, and Ayyappan R, VP at Flipkart, taking charge as head of categories at Myntra-Jabong. Myntra’s chief technology officer Jeyandran Venugopal was shifted to Flipkart to head its engineering division as ET reported last month.
All these changes took place even as Ananth Narayanan stepped down as CEO of Myntra-Jabong earlier this month and a bunch of other top executives from the fashion portal departed, leaving Krishnamurthy firmly in control of all the three e-commerce units — Flipkart, Myntra and Jabong.
Flipkart in 2016 and now
ET spoke to Krishnamurthy to understand how organisationally the Walmart-owned Flipkart of today is different from what it looked like when he returned in 2016.
“We have never seen any instability in the company even in the past few years when some leaders left,” Krishnamurthy said. “In 2017, I would have spent 70% of my time in fundraise but the business accelerated, so the company is no longer dependent on a couple of people.”
It is not only the exodus of senior executives, but a raft of changes swept through the Bengaluru-based online retailer in the past year, with both its cofounders Sachin Bansal and Binny Bansal (who aren’t related) now out. But Krishnamurthy demurred that there has been a constant top-level churn at Flipkart.
“This is a bit of a market perception that a lot of changes have taken place over the last two years. At the VP and SVP level almost nothing has changed,” he said. “We have many mini-CEOs who take massive business responsibilities and most of these have been with us for on an average of five years. Our attrition is comparable to global tech companies and in a category so dynamic where new startups come up and offer huge monetary incentives and stocks, our attrition at senior level is 11-13% and for critical employees it is 8-9%.”
According to Krishnamurthy, offering local stock incentive has helped Flipkart retail key talent. “Even after Walmart came in, our employees have Flipkart stock,” he said. “So if you take Flipkart from zero to 100, we get incentivised for that here. That’s a very big differentiator from when you are a subsidiary of an MNC. Almost every year we have provided liquidity to our employees and ex-employees. So whether we are listed or not listed, we have a structured programme.”
A person who has worked with Krishnamurthy earlier said, “What has happened since he took control of Flipkart is that he has groomed a set of younger managers at director and senior director levels in his own way and these are the ones who are now being given bigger roles. Most of them were around when he first came in 2013.”
While Nagaram and Ayyappan have been handed over significant responsibilities at Myntra, Sandeep Karwa, who was steering the mobile phone category, is now heading Flipkart’s hyperlocal venture, and Smrithi Ravichandran, who has been with the company for seven years, is helming payments and consumer fintech.
This is a very different approach to what the Bansals (Sachin and Binny Bansal who are not related) tried when they hired a lot of C-level executives from outside in the 2015-2016 period, the person said.
“He (Krishnamurthy) may run himself thin as the top management doesn’t have too many specialised professionals but ones who are learning on the job,” a former Flipkart employee said on the condition of anonymity. “Flipkart has been wanting to push the grocery category for two years now, but what may have been an issue is not having someone with relevant experience to steer the project. This is where the company needs talent from outside or someone who has done this before.”
While Krishnamurthy made the right strategic move by getting back the agility at Flipkart as he cut the layers, one needs to understand that at the company’s current scale, executives need nimbleness and experience both in their respective domains, the person said.
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