Daybreak - Not such a Great Place To Work after all?

Episode Date: July 16, 2024

About two months ago, something pretty bizarre happened at the India office of Great Place to Work. At about 2:30 am on May 28, the board of the organization was summoned for a Zoom call. But the timing of the Zoom call wasn’t what was so alarming. At one point during the conversation, the founder, Prasenjit Bhattacharya, asked everyone to leave the call. Everyone except for Yeshasvini Ramaswami, the chief executive of the company. Just a few moments later, Prasenjit told her that she was being fired. You see, this isn’t the first time a CEO has been fired. But the way that this particular incident played out went against everything that Great Place to Work has stood for for so long.What's going on? Tune in 

Hi, this is Rohan Dharma Kumar. If you've heard any of the Ken's podcasts, you've probably heard me, my interruptions, my analogies, and my contrarian takes on most topics. And you might rightly be wondering why am I interrupting this episode too. It's for a special announcement. For the last few months, I and Sita Raman Ganeshan, my colleague and the Ken's deputy editor, have been working on an ambitious new podcast. It's called Intermission.

We want to tell the secret sauce stories of India's greatest companies. Stories of how they were born, how they fought to survive, how they build their organizations and culture, how they manage to innovate and thrive over decades, and most importantly, how they're poised today. To do that, Sita and I have been reading books, poring over reports, going through financial statements, digging up archives, and talking to dozens of people. And if that wasn't enough, we also decided to throw in video into the mix. Yes, you heard that right. Intermission has also had to find its footing in the world of multi-camera shoots in professional studios, laborious editing, and extensive post-production. Sita and I are still reeling from the intensity of our first studio recording.

Intermission launches on March 23rd. To get alert, as soon as we release our first studio. episode, please follow intermission on Spotify and Apple Podcasts or subscribe to the Ken's YouTube channel. You can find all of the links at the ken.com slash I am. With that, back to your episode. Two months ago, something pretty bizarre happened at the India Office of Great Place to Work. At about 2.30am on May 28th, the board of the organization was summoned for a Zoom call. But it wasn't the timing of the Zoom call that was so alarming. You see, at one point during the conversation, the founder, Prasanjid Bhattacharya, asked everyone to leave the call.

That is, everyone except for Yasaswini Ramoswami, the chief executive of the company. And just a few moments later, Prasanjid told her that she was being fired. Now, of course, this isn't the first time a CEO has been fired. But the way that this particular incident played out went against everything that great place to work has stood for, for so. long. You see, this is an organization of self-proclaimed workplace culture experts. It's an organization that prides itself on trust and reliability. For those of you who haven't heard about this organization before, its name pretty much gives away what it does. It basically assesses whether different companies are, well, great places to work based on a number of parameters.

In the last two decades or so, it's become one of the most reputed certification and consulting firms in the world. So today, getting certified by a great place to work or making it to one of its best workplace lists is considered a badge of honour for most companies. Which is why how Yasaswani's sudden termination played out is the ultimate irony. At the time of the Zoom call, she was in the US for the company's global summit. Her email access was immediately cut off and her message was sent out to the organisation's 100 odd employees, informing them that budget. Albir Singh, the then C.O, would be replacing her. They were all also asked not to reach out to her.

Yishaswani's exit came as a massive surprise to a lot of people in the industry. Because in the three years that she served as CEO, good place to work India really, really thrived. Its revenues and profits soared to an all-time high. And the timing of this particular incident is really eerie, because the Ken has learned that just, Just before she was laid off, the organisation was in talks for a private equity buyout, which ultimately ended up falling through.

So what's going on at great place to work? And did Yeshashaswini become a victim of her own success? Welcome to Daybreak, a business podcast from the Ken. I'm your host Rahil Filippos, and I'll be joining Snickhah Sharma every week to bring you one business story that is worth understanding and worth your time. Today is Wednesday. the 17th of July.

Before Yasaswini Ramaswami became CEO of Great Place to Work, she was the founder of a startup called CultureLytics. Interestingly enough, her startup was doing the same sort of work, basically evaluating corporate culture to assist human resource professionals. Great Place to Work, meanwhile, was on a whole different level. It publishes some pretty significant rankings in a bunch of different categories, like I mentioned before, including, quite ironically, Best Workplaces for Women.

It's a very trusted organization, not just because of its rankings, but also because of its impressive book of clients. Great Place to Work India is a franchise of the 30-year-old organization, and it is just as respected here in India. For context, its founder, Prasanjid Bhaticharya, is a majority stakeholder in the organization. Anyway, the reason the organization was interested in Yashaswani's startup in the first place was because it also had a pretty impressive book of clients.

It was working with companies like SPI, Bank of Baroda and KPMG to name a few. So, Bhattacharya saw an opportunity there and went for it. He pitched an equity swap between Great Place to Work India and Culture Lytics. Now, sure, yeshas-saint-up was doing relatively well. But at the end of the day, it was still just a scrappy startup. Suddenly, the big daddy of workplace certification firms had shown interest. and this was her shot at boosting her company's visibility. So she jumped at the opportunity.

And as part of the deal, she took the helm at Great Place to Work. This also worked out well for Bhattacharya in some way. He could now focus on his other ventures, particularly his passion project, the great manager institute, which he founded in 2017 to train people at different companies to be, well, great people managers. So it was sort of a win-win situation. Yeshashaswani really turned things around for the company.

She began by streamlining processes to untangle Great Place to Work from Bhattacharya's other businesses, including the Great Manager Institute. Before this, his other ventures, which also included the Work with Dignity Foundation for Social Impact Work, were all managed under the umbrella of Great Place Research and Consultancy. And with Great Place to Work, India unshackled, she had free reign to run the show. She first dove right into introducing transparency in client communication. In fact, this is one of the things that she's most remembered for. This effort to clarify and improve transparency

improved clients' overall faith in Great Place to Work. And all her big bets ended up paying off. You see, pre-de-merger, the parent entity, made $7,000,000 in profit in FI-21. And post-Diverger, Great Place to Work India alone clocked 11 crore rupees and profits the following year. By the time of her abrupt ouster, profits had soared to 18 crore rupees.

So what went wrong? More on that in the next segment. Under Yashaswini's leadership, Great Place to Work's valuation went up to 300 crore rupees by 2024. And the rapid growth of the company caught a lot of people's attention, including, of course, the company's own board. This was when talks of a possible private equity buyer, started. And now the ken has learned that negotiations finally boil down to about three suitors.

Of them, InCorp Global, part of East Asian Powerhouse Hillhouse investments, offered the juiciest deal. It was a 300-crowed-sell-cellout deal that was largely forged by Ramoswamy herself. But it wasn't meant to be. Just as the ink was about to dry, Bhaticharya pulled the plug. Ramaswami did try to push back, but unfortunately, she ended up being pink-slipped. In the days that followed her termination, it was like the company's top brass was trying to erase every last trace of Ramaswami's mark on the company.

That included mailing all of the company's clients to inform them about the change in leadership. Like I mentioned earlier, a few clients were completely caught off guard. It made some of them question great place-to-works internal processes. But for others, particularly those used to working with Singh, Ramaswami's successor, it was business as usual. What was strange was how the company tried to act like nothing had happened. Even the official press release announcing Singh's elevation to CEO barely mentioned Yashashwini.

When the Kent spoke to Yashashvani, she said she was now shifting focus back to her own company. Her main goals now are to focus on rebuilding her own business and leave the stint at great place to work behind her. I'm sure the irony isn't lost on you. Here is an organisation that prides itself on being the business. final word on workplace culture. For it to then go ahead and fire its CEO, despite her great track record, with no questions asked, seems pretty suss, right? What then happens to diversity, equity and inclusion that was supposed to be the foundation

of Great Place to Work? So the bottom line is that it seems like an uphill battle for genuine workplace fairness. Daybreak is produced from the newsroom of the Ken, India's first subscriber-focused business news platform. What you're listening to is just a small sample of our subscriber-only offerings. A full subscription unlocks daily long-form feature stories, newsletters and podcast extras. Head to the ken.com and click on the red subscribe button on the top of the website. Today's episode was hosted by Rahil Filippo's, produced by me Snikda Sharma and edited by Rajiv Sien.