A new face to make 'em buy

Kripa Raman

HOW does one prune and trim one's staff and expenses while also projecting a bigger, more aggressive and attractive face to the potential customer? This is a preoccupation with many a mid- sized or smaller Indian IT company that is restructuring to battle the slowdown in the industry.

''The largest IT companies in the country, like TCS, Infosys and Wipro, have size on their side,'' says an IT analyst. ''It has become important that companies scale up their size so that the customer has more confidence in them; in today's scenario, smallness creates a fear in the customer that his supplier or vendor might shut down altogether whereas a very big company would still have something left even if it scaled down dramatically. Apart from the big ones, all the others have to put forward some kind of unique face on the ramp.''

Everybody is now talking of a ''smart front-end.'' This basically boils down to hiring smart and aggressive people, preferably with an ''international face or background'' who represent the face of the company to the public at large, as well as strong brand-building, says a software analyst.

The Mumbai-based Orient Information Technology, which did revenues of Rs 90 crore in 2000-2001, says it has restructured itself swiftly, although it was not particularly affected by the slowdown. ''We found the back-office was too top-heavy, so we shrank it and reduced overheads,'' says the Managing Director, Ketan Sheth. ''Although the general pay revision is downwards, we have introduced performance-based salaries, redefined jobs.''

A decision has been made to get into the ''high-end IT- enabled services,'' look for acquisitions in the US and work out possible joint ventures in Saudi Arabia, and a presence in Japan ....'all to find niche markets'.''

A major emphasis is, however, on the front-end - Sheth says the marketing team is being improved. A new CEO from ITC Infotech has been hired for Orient's UK operations and a new chief for the IT-enabled services hired from Hindustan Petroleum.

At Mahindra-British Telecom, a joint venture between M&M and British Telecom, (which, too, has weathered the slowdown pretty well), a new Executive Director and CEO, John Helleur, has been appointed. Helleur has experience with British Telecom and is also a Member of the British Empire. The company Web site says there is opportunity when global telecom companies are struggling, when back-end development would be shifted to cheaper offshore centres such as India. The company is also looking to Asia for more business, increasing offshore work and introducing cost-control measures.

Silverline Technologies announced a new organisational structure recently. Ravi Singh, who was appointed co-CEO with outgoing co-CEO Shankar Iyer, made no bones about the fact that the front-end would be represented by the more aggressive team extracted from Seranova Inc (which Silverline bought over); while the more nuts-and-bolts kind of people, largely from Silverline itself, would look after the internal affairs. Along with this appointment, the Chairman, Ravi Subramaniam, was appointed Executive Chairman, with a more hands-on approach to matters.

Singh was earlier Vice-President of Corporate Development of US-based Seranova Inc. He has a background with, among others, Punk Ziegel & Co and with Coopers and Lybrand in the US.

The group recently inaugurated its new Silverline GmBh office of 500 sq.ft in London, calling Keith Vaz, MP in the House of Commons, to inaugurate it, while appointing Albert May, earlier director at Unisys, to head that office.

Mastek Ltd, hit quite severely by the slowdown this year, has formed a joint venture with Deloitte Consulting. The workforce for this joint venture is to come from Mastek itself, which leads some analysts to think that it is ''somewhat akin to selling off a bit of Mastek itself, but one way of keeping oneself going, alone or otherwise.'' The group, however, holds that Mastek Ltd will continue to function as it did.

Mastek says it has made substantial changes in its organisational structure and processes. There are two newly-created functions, one to look after ''organic growth,'' the other to look after ''joint ventures and acquisitions.''

The joint venture with Deloitte has started its sales and marketing activities in the US, in Europe and in the Asia-Pacific, says Mastek.

'Freshest technologies first'

NIIT too says it is in an aggressive brand-building and business development mode while also cutting costs. Tight management of expenses on premises, energy and executive travel will be more pronounced, the company has said. The company is also renegotiating bought-out services and supplies with all its vendors.

At the same time, ''Senior Professionals'' have been recruited in all geographies. Practice heads with the Big Five consultants have been taken on board in the US and sales leadership in the UK and the business development team in Japan strengthened.

On the training front, NIIT has claimed that it snatched market share during the previous month from the number two and number three players; it has fanned out to 125 more centres ''to ensure that when smaller players get marginalised, NIIT is ready to cater to the demand.''

Freshest technologies first, is the motto as NIIT ties up with Microsoft, Citrix and Oracle to offer the latest software-training modules. The outlook is with an emphasis on ''aggressive brand building.'' Rival Aptech, too, is now concentrating on brand-building, with the emphasis on its multimedia training package, Arena.

Meanwhile, the software activities of Aptech and group software company Hexaware are being merged to form what the group calls a larger entity.

''We have changed our productivity parameters,'' says Pramod Khera, chief of Aptech's training division. Like other software companies, Aptech now sets importance by its sales force. ''We are changing our sales processes, we are benchmarking our productivity parameters against those of other industries.''

''It is interesting that while cutting costs to the minimum, companies should also find that the brand-building exercise, which is contradictorily, an expensive one, becomes very important,'' says the CEO of a Mumbai-based software company.

Polaris too, while announcing its Q2 results for the current financial year, says it finds that now is the opportunity for its aggressive brand-building strategy.

''Large customers are looking at cost savings out of India of between $50 million and $150 million from projects out of India,'' says Arun Jain, Chairman and Managing Director, in the company's announcement of its results.

GTL Ltd (earlier Global Tele-systems), also set back by the slowdown, says it is strengthening its contact centre business as part of its business process reengineering. It is reducing focus on its ASP businesses such as EDI, e-fax and payment gateway services.

Strangely, Kale, which used to do a lot of airline industry work and might be thought to be changing its business focus, says its business model remains unchanged. ''We have tripled our customer base from 11 to 35 airline customers.''

''We are in a position where we compete with the global companies very successfully. This has become even more so after the September 11 episode. Longer-term, airlines will face cost pressures and will have to outsource,'' says Vipul Jain, Chief Executive Officer.

''On our radar are acquisitions, we are looking at anything that will strengthen our business model.''

kripram@thehindu.co.in

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